Special Levy - any suggestions

[ohricey]

Hi all,

Have just learnt that an Extraordinary General Meeting has been called to pass agreement on the raising of a Special Levy.

It appears there are some waterproofing issues in some areas of the building. What seems to be most affected are the balconies of 4 different units plus a few other water issues.

They are trying to raise nearly $100K, of which I think I will need to contribute about $4.5K.

I'm not really happy about this. I can't afford it, and it appears the issues do not affect me or my property directly.

I know this is a selfish viewpoint to take, but how selfish really? I mean, I can understand that we would all have to pay if it was a problem that affected everyone (common property etc) - but this isn't.

What options are available to me, or is this one of those things I just need to suck up and get on with? I mean, I know I can vote to not pass the levy but is this really the right thing to do.

 

[alexlee]

Resale value of the affected units will drag down the resale value of yours.

Your options are:
1) vote against it
2) if it passes, pay it
3) sell the unit

If you can't afford 5k, what happens if interest rates go up?

 

[Aaron_C]

Maybe best option is to sell it and let it be someone else's problem.

 

[ohricey]

If you can't afford 5k, what happens if interest rates go up?

Mmm, I should rephrase. I guess we could afford the $5K, I just don't really want to spend it on something like this.

Selling isn't an option either as I don't think that is a good long term solution for a short term problem.

 

[Raddles]

Hi there
are you happy with the quote for the repairs?

My daughter had an EGM which required approval of a special levy
The members of the body corporate insisted on further quotes being obtained - and a more realistic quote was obtained that didn't draw on all the sinking fund

 

[Luv2Travel]

Mmm, I should rephrase. I guess we could afford the $5K, I just don't really want to spend it on something like this.

You might be more suited to a house then, without a body corporate. That's what being a part of a body corporate is all about. One day your building might need some major repairs, and the other owners will all have to chip in to pay for something that doesn't directly affect them. It all balances out in the end. Spend the money, maintain the block and don't let your building devalue due to being run down because no one wants to spend any money. It'll cost more in the end.

 

[pully]

how long have you had the property? how much is in the sinking fund? how old is the property?

are there likely to be further issues requiring maintance in the short term?

just a few ? to ask yourself. good luck with it all. water damage can potentially mean a lot of expense and therefore better to nip it in the bud asap.

yes strata titled buildings are a shared responsibility.

 

[ohricey]

are you happy with the quote for the repairs?

Not particularly. They did get three quotes, and they chose the middle option which was about $8K more than the cheapest (but also almost $20K less than the next).

It sounds very expensive to me, but then I have no knowledge to base this on!

 

[ohricey]

Thanks Biggles and Pully - kind of what I was leaning towards too, albeit reluctantly.

I don't want to spend the money but acknowledge that it is a shared responsibility.

Most examples I researched were common issues that affected all involved, so it just made me wonder a bit about this one. Plus the cost seems quite disproportionately high.

It does make me wonder what everyone else will vote though!

 

[Jen_PFR]

One of the things about apartment complexes is that the 'common area' provisions go both ways.

We once owned an apartment in a three storey block that needed major plumbing works done, to the tune of hundreds of thousands of dollars. We were on the second floor, so it didn't directly affect us at all. However, the less than charming impact on the ground floor apartments was that the toilets would regularly back up and flood entire properties with the sewage from the complex. (By 'regularly' I mean 'every few weeks'.)

Alternatively, if there had been major problems with the roof, it would have made our lives very difficult, while the ground floor occupants wouldn't have had any impact at all.

Swings and roundabouts I guess.

 

[DaveM]

If the shoe was on the other foot and your apartment had damage, would you be jumping up and down to get it fixed and unhappy if other owners rejected the repair work?

Strata owership is give and take... repair work today on someone elses lot could be repair work tomorrow on your lot.

It illustrates the need to set aside funds for R&M in your IP budget.

 

[Terry_w]

That is a small amount. What will happen is they will 'find' more problems and the cost will balloon out to $300k.

There is a complex in pyrmont sydney which has just spent around $6mil on waterproofing. Tiles on the top balconies and root 'had' to be jack hammered up and a new waterpoofing membrane laid and then retiled. Some units were using the enclosed balconies as bedrooms and they were complaining about window leaks so they pulled out all the windows on the balconies and redid them. The whole project too nearly 2 years.

Some unit holders had to chip in $30k.

You wonder what really goes on behind the scenes. How these quotes get chosen and the relationships of all the parties...

 

[attrill]

This is one of the reasons I am getting out of strata complexes, Too much politics.

I had a ground floor unit with a courtyard in a large 3 story block. Residents on the 1st and second floor didn't see why they should chip in to pay for all the fences that were rotten. Trouble was the fences were common property.

When it came to fixing the roof and the gutters, of course then the top floor owners were quite happy to have the cost split equally.

Stratas are great if that is your thing, but I'm just over them. The AGM in a block of 84 was like question time in parliament!

 

[Nth Brisbanite]

4.5K is not a lot of money for major repairs. Just think, it would have cost you a lot more if it was your own property. Recently, I had to pay over 30K to get underpinning for my own property. I wish that I could have shared it amongst other home owners.

If you can afford it, pay for it as it will maintain the value of your unit. If you leave it any longer then the costs are going to go up. You didn't mention whether you are an investor or if it is PPOR - if you are an investor, it will be tax deductible.