Body Corporate, Caretaking, etc. Fees - What is fair and reasonable?

Hi all,
I've just joined up - heaps of handy info on this site!

I currently own and live in a unit in a 27-unit complex and I was looking over my Body Corporate budget and I am suspicious that I am getting ripped off. I was wondering if any of you experienced property investors out there could give me a feel for whether or not this was the case.

The fairly modern (i.e. < 5 years) complex is divided up physical into three sections, and into four Bodies Corporate. BC1 is the 'generic' common area - i.e. gardens, basement car park etc., whereas BCs2-4 are essentially the corridors/stairs for the insides of the three physical sections of the building. You cannot go from one section to another without going outside, hence the four BCs, instead of one big one.

The complex has three levels plus a basement car park. It has one lift, which is located in Common Area 3, and funded by BC3. BCs2 and 4 don't need a lift as the corresponding common areas have only two levels (the building has a 2-3-2 level structure). There is also a fairly decent sized garden, some lawn, and a BBQ in the common area. The other thing worth mentioning is the intercom system.

Now, my questions are as follows:
1. What do you think would be a reasonable per-lot fee to be charged by a BC management company for this type of property?
2. What do you think would be a reasonable per-annum caretakers fee? Our caretakers seem to sweep and mop the floors once to twice a week, take care of any on the spot maintenance, and put the bins out. We have a separate budget for gardening, so I am guessing the caretakers do not do this.
3. What would you expect to be paying for fire equipment maintenance?

Please advise if you need extra info to answer these questions.

Thank you all kindly in advance!
 
The body corporate is a non-profit organisation.

It is you (the owner) who approves the budget and spending each year. If you think you are being overcharged for any elemnt - it is you who should find more cost effective methods and bring these to the table of the committee.

Cheers,

The Y-man
 
Sorry if I wasn't clear.

I understand that the BC itself is non-profit; I am talking about the service providers (i.e. the company that manages the BC, the caretakers, and fire equipment maintenance company), one of which are non-profit. e.g. our BC pays a third party company to do the caretaking, same as if you were to call a gardener in if you couldn't be bothered doing the gardening. The gardener is making a profit. I am concerned that the service providers that our BC manager has chosen are ripping us off. I am also concerned that the BC manager is also ripping us off. The trouble is, I don't have anything to benchmark the fees we are paying against - this is what I am asking for in this thread.

Thanks again
 
Sorry if I wasn't clear.

I understand that the BC itself is non-profit; I am talking about the service providers (i.e. the company that manages the BC, the caretakers, and fire equipment maintenance company), none of which are non-profit. Although I think we may be getting overcharged, I don't have anything to benchmark our charges against - this is what I am asking for in this thread.

Thanks again
As an owner of the complex you can have your say by going along to the annual meeting and asking questions. The body corporate committee represents the owners so if you have any suspicions you should contact one of the committee members.

The company that manages the BC, the caretakers and fire equipment maintenance company shouldn't be working independently from the owners. If that is the case then blame all the slack owners, not those who are working for them.

I'm chairman of an active body corp committee. If anyone working for us go outside our guidelines then we give them the sack. My body corporate manager said that the majority of owners in complexes are apathetic.

I cannot answer the questions you have posed as I don't have experience in your type of complex. Surely the body corporate manager should be able to give you answers to these questions as he/she should know the costs in similar complexes.
 
you haven't provided any details for us to give prices against ?

Get a copy of the budget, and go through it. You will see where the money is going and can decide from there a bit better.

Y-man is correct.

We know they are using 3rd party contractors (?) The point is the BC manager is using the contractors that the owners agreed to use for the pric the owenrs agreed to pay.

So review the charges - maybe provide them here

WE found going through ours tha some thigns on the property were just damn high cost - old hot water heaters and other things. The apatheticness of owners and a strata manager who takes advantage of that by also doing nothing ensured nothing happened.

Way to overcome that is, if that id what you find yourself against is to take ir upon yourself to raise the issue & take charge of solving it
 
I wish it were that simple - unfortunately, on day one the developers of the complex signed a 5-year contract with the BC managers. The BC managers then went and locked the BC into 5-year contracts with various service providers. This all happened before I bought into the complex.

I've since been told by one of the BC committee members that the BC managing company has a vested interest in the companies that provide the services such as caretaking and maintenance. Although I have not been able to confirm this, it would not surprise me if it were true.

At the last AGM, I was elected onto the committee. During the meeting, I also queried the fees we were paying for the caretaking services and were told by the managers that the fees were 'reasonable' and couldn't be changed anyway because we are contracted to the caretaking company. The thing is, I have no idea if they are telling me the truth about the fees or not as I have nothing to compare them to, which is what brings me here. They _seem_ pretty steep to me (we are paying more than 21k per year).

In any case, the five-year term ends in about a year and i want to prepare myself for a possible change.
 
List out the actual literal specific jobs that are the issue, including BC manger's job / rought job description / the current contractor & price.

Start getting qutoes from people for each.

Pain in the neck is the lenght of time it will take so one year to go may not be bad - gives you time to discuss any cheaper qutoes etc with other committee members and agree what to do next - them, you would either tell the BC mnger wht to chagne / or get agreement from the other owners
on the change...
 
sorry if that wasn't the answer you were after, but do you see what I mean ?
Thanks for your reply - I think I see what you mean, I'll see if I can add some more useful info:

Can't remember for the life of me what %age or whatever strata manager charges for the compex I live in, but as said above, I know that the group is full of apathetic ownrs who wwnt someone else to do it (anything) and the strata manager (and the previous ones at the previous company we sacked) won't put the effort in to rally everyone togher and get the ball rolling - why would she, she gets paid either way and has other more profitable things to do.
From the minutes of the very first meeting, when the contract was signed, it looks like our contract started at about $9k with 5% increases each year (one year had a 13% increase - unfortunately I wasn't an owner back then and so have no idea why this happened). Right now they are over $11k. This is just the annual 'flat' fee. They then charge us for various other services such as organising maintenance, property visits, and so forth on a case by case basis. It's the flat fee I am unsure of.

Gardening charges can vary hugely from one property to the next depending on requirements / as can common electricity & water usage, bit hard I think to give you any benchamrks..
I'm not too worried about our gardening or electricity and so forth; the fees we are paying seem reasonable. It's the caretaking that has me stumped - we are paying 21k+ per year. It seems like a lot to me, but then I wouldn't have a clue. All I know is that I'd be happy to do the caretaking work myself for half that much :)
 
Yeah see if you can get a job descrioption of what the caretaker is supposed to do (regardless of wether they do it or not, it probably needs to be done & you wont be much happier withany new contractor if it doesn't).

Then see if you can a quote or two - yeah, I know, I know.....
 
List out the actual literal specific jobs that are the issue, including BC manger's job / rought job description / the current contractor & price.

Start getting qutoes from people for each.

Pain in the neck is the lenght of time it will take so one year to go may not be bad - gives you time to discuss any cheaper qutoes etc with other committee members and agree what to do next - them, you would either tell the BC mnger wht to chagne / or get agreement from the other owners
on the change...
Thanks, jaycee. This makes a lot of sense. You've all inspired me to dig up my budget!
The managing agent's fees are approx 11k
These guys give us a standard form listing their tasks and responsibilities. The content of the form resembles what's listed here:
http://www.ocv.org.au/consumerinfo_roleofbodycorpman.php

The 'resident manager's' fees are approx 20.5k
These guys seem to clean the common property, change light globes in the common property, put the bins out and give access to anyone that needs access to the building (e.g. plumbers, electricians and so on).

The 'essential services' fees are approx 2k
according the budget, essential services are "Monthly Panel Testing / sprinkler system / Annual Flow Testing ADT / Fire Monitoring"

The 'fire equipment maintenance' fees are approx 4k
I have no idea what this is - it looks to me like it should come under 'essential services'

There is 12k in the budget for public lighting but this sounds about right to me (I went into the meter room, inspected the common property power meter and calculated the bill based on what i pay per kW/hr). It seems our building isn't very carbon neutral!

The remaining fees are all smallish items.
 
So the resident manager-also the caretakers ?, and the fire equipement charge is the real fee you are querying.

Fire equipement - it may just be under a differnt heading, but you are probably paying for different things. What might not be too bad to check if you need to pay for them or not (?) At the same time, don't want to scrimp to much either....

Resident manager - job decription and go from there I'd say
 
So the resident manager-also the caretakers ?,
Yeah - I think they are one and the same. That said, the 'resident' manager certainly isn't a resident of the complex.

and the fire equipement charge is the real fee you are querying.
Fire equipement - it may just be under a differnt heading, but you are probably paying for different things. What might not be too bad to check if you need to pay for them or not (?) At the same time, don't want to scrimp to much either....
Hmmm - you are probably right. It's probably 4k spread over a larger number of invoices. I might pay the managing company a visit and ask to see these invoices.

The third fee I am querying is the fee the managing company charges us (i.e. the 11k). I'd love to know what other people who own units get charged by their BC managing company.

On another note, I completely relate to the apathetic owner syndrome. Frustrating. One of the reasons I am here at 11pm on a Saturday night is because I'm trying desperately to break the 'apathy culture' in our BC. I bought into the complex 10 months ago and have barely been able to get anything to happen. I'd love to hear others' advice on how to get members of a BC more involved. Topic for another thread perhaps...
 
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