Strata report received

[annE]

Hi all

I'd like some advice on the following: I've just received the Strata Report on a 30 year old unit in a NSW regional town.There are 38 lots in the complex.

- I note that the present Admin Fund balance is $1,124.81 and Sinking Fund balance is $21,725.70. Quarterly levies are $262.16 for the Admin Fund and $42.89 for the Sinking Fund. These amounts appear to be extremely low to me.

Also the Owners Corporation did not approve an increase in the levies in 2011. Next expected increase at the AGM in April 2012. The Building Inspection report showed that the roof flashing and timber barges are deteriorating and should be repaired - this is a Owners Corporation responsibility and for the unit in question will cost around $4,000
alone.


- Under the Strata Roll heading there is a note: Mortgagee that is recorded on the roll: Yes - What does this mean?

In view of the above I'm seriously thinking of not continuing with the purchase.

Any comments?

Ciao

annE

 

[Propertunity]

- I note that the present Admin Fund balance is $1,124.81 and Sinking Fund balance is $21,725.70. Quarterly levies are $262.16 for the Admin Fund and $42.89 for the Sinking Fund. These amounts appear to be extremely low to me.

These figures are low. However, I see this quite often. It is nothing to be overly concerned about - apart from the fact that the strata leveies need to be raised and/or a special levy needs to be struck to lift the balance of the sinking and admin funds. Just allow for this in the offer you are making to purchase.

Read the strata report and see what reactions have been from other unit holders in the past in relation to spending money on things. You don't want to buy in there if every bit of spending gets voted down all the time.

The Building Inspection report showed that the roof flashing and timber barges are deteriorating and should be repaired - this is a Owners Corporation responsibility and for the unit in question will cost around $4,000 alone.

Again, nothing too uncommon with this.

It sounds like the BC has kept strata levies artifically low and now does not have enough funds to do maintenance. That does not make the unit a bad purchase necessarily, just that funds need to be raised and levies increased.