Should I be worried?

L

lamp

Was about to make an offer to this property and thought I should let my solicitor review the contract of sale before signing anything. Solicitor called back to day telling me that the Owners Body Coporate Certificate/AGM meeting report is out dated (year 2011) and advise that I should contact them for the most recent one. As the condition of the unit looks very new, I was so tempted to just not bother with asking for the up to date copy of the document and just sign the contract.

The agent told me that it will take time (2 weeks) to obtain the latest document, that I then became a bit shaken and wanting to just sign the contract worrying that someone may pop up with an offer!

Even I was sooo tempted, but I've decided to wait for the document! Wondering what would others do?
 
Don't go in blind, or get your solicitor to draft a condition so the contract is subject to the receipt of that and your satisfaction with it at your absolute discretion.

D
 
Two cliches come to mind....

Act in haste, repent at leisure.

and my own one..

The buy of the year in property comes around about once a month.
 
Take your time and wait for the report. They are probably in breach of their obligations under section 32 by having an outdated one there.
 
It may also have been on the market or they previously tried to sell it in 2011, could be used in your favour to get a better price. Certainly wait for updated report before committing, don't be taken in by an agent trying to rush through a sale.
 
Yes, why is it outdated ? probably because they tried to sell it before and failed.

Why not just add a special condition and submit your offer subject to the report.
 
Thanks all! Yes, I'm patiently waiting and will run pass my solicitor's eyes once the report is ready :)

I think Terry W and Simtra are right as the property was in the market for sale last year.
 
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The last one being 2011 only 1 year ago, and you state it is fairly new. Surely it could not be too much different. I guess the decision comes down to what you are comfortable with :)
 
No doubt that my mortgage broker and solicitor are more rational then myself, I would choose to trust their advice :)
 
I know that the moment has passed for the OP, but you should NEVER look at an out of date body corporate disclosure statement, CMS or minutes.

Especially so when it comes to new properties! New properties have no sinking fund to speak of. This is usually remedied by ramping up the levies and contributions over the first few years to save up some cash.

There are also cases where the building might have major structural defects that require extremely involved legal proceedings to resolve (at the cost of the lot holders of course).

One 'Woolstore' development in Brisbane is new and flash and with body corporate levies to match (around 8K pa) On the 2011 disclosure everyone is happy and no problems.

Any buyer who looks at the current disclosure would find out that the building needs a new roof as it was not done properly when it was developed into units, and there is an ongoing legal dispute that's pushing into the hundreds of thousands in costs so far. If costs are not resolved, the lot holders are going to be up for some serious money.

I manage two units in a complex around 5 years old that requires 8 million dollars worth of work to make the external walls waterproof.

And finally, I almost bought a unit in a small block, until I found out that if the roof and stairs were not replaced within 3 weeks of me inspecting it (at a cost of around $30,000 per unit), the building would be condemned by the Brisbane City Council. (I later found out someone from the forum actually bought this unit without doing their DD and ended up $30,000 poorer).

Moral of the story: be aware of what you're getting into with the most up to date information only.

Matt
 
mattysavager said:
And finally, I almost bought a unit in a small block, until I found out that if the roof and stairs were not replaced within 3 weeks of me inspecting it (at a cost of around $30,000 per unit), the building would be condemned by the Brisbane City Council. (I later found out someone from the forum actually bought this unit without doing their DD and ended up $30,000 poorer).
Click to expand...

Don't these sort of known future liabilities need to legally be disclosed in the sales contract ? They were when I bought a unit in Sydney and the price reflected this (12K per unit for stairs reconstruction)
 
wategos said:
Don't these sort of known future liabilities need to legally be disclosed in the sales contract ? They were when I bought a unit in Sydney and the price reflected this (12K per unit for stairs reconstruction)
Click to expand...

Yes they do, but the onus is really on the buyer doing their due diligence.

Some vendors are sneaky and don't tell anyone the full story. Most agents take what the vendor says at face value, and don't read body corp docs looking for the truth.

In QLD there are functions of the contract and paperwork to stop things like the above from happening, but a property can settle without these being fulfilled, so long as neither party picks up on it and asks the question.

I just don't want anyone listening to advice along the lines of 'how bad can it be?' - as it can be bad.
 
I eventually made an offer but was out bidded, got the updated docco and this property is all fine except rate has increased since a year ago, but nothing major.

Yes, in some cases, it could be something major. A year ago I was looking into an apartment from Croydon, it looked very new and the design was fantistic, I couldn't anything wrong with my bare eyes. However, multiple apartments were on sale at the same time through different agents. I asked the agent for the reason and one responded these apartments were initially bought in for super fund investment and now they are selling for the profit. Out of my curiosity, I contacted another agent and he was very secretive about it and said the he will tell me when we meet. Once we met, he took me to the apartment and told me that the balcony of all apartments within the block has structural problem and the owners corp has been dealing with the developer for almost 3 years and the AGM minutes are as thick as a phone book....I recently see one of these apartments is out in the market for sale again, not sure if the issue has been resolved though!
 
Better safe than sorry.

On the comment re Woolstores. I had a supplier with one in Pyrmont Sydney. Again major leak issues and fighting the builder for over 10 years. SO far BC has spent $500k in legal fees. Repair was estimated to be $10M. Builder just keep going to court to delay.

Consequently BC fees were massive. Result after 10 years despite rents going up significantly he sold for the price he bought in . No CG.

FYI Peter 14.7
 
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