Sydney - why are strata fees so high???

Agree with John & Rolf. I used to be anti-units due principally to the strata and no-land, but it only takes owning one old house for you to realise how many things can go wrong and how expensive they are to maintain. The numbers at tax time confirm the houses make more loss than units.

In relation to the no-land issue, good quality units within close proximity to Syd CBD have performed very well ... for the much lower entrance costs and generally higher yield, I can see why people are starting to shift their preferences in buying units over houses.
 
Please tell me that you are kidding.

The age old complaint about Body Corporate fees really amazes me. The only difference between Body Corporate fees and basic house maintenance is that with Units, you actually know in advance what your bill is going to be.
With houses (especially old ones) you just keep dipping into your back pocket to pay unforseen bills.

When you compare Strate fees to the cost of running a house over 12 months, in most cases the unit will come out cheaper than the house.

Compare a unit with B/C fees of $2000 a year and rates of $1,500 a year Total $3,500 a year) to a house that you don't have B/C fees but have rates at $2000 a year Building Insurance at $500 a year plus all of those unthought of expenses like garden maintenance ($500 a year), painting $15,000 every 10 years), fence maintenance ($2000 every 10 years), rubbish removal ($50 a year), Roof and guttering maintenance ($10,000 every 10 years), Pest treatments ($300 a year) - What are we up to now? Around $6,500 a year.

Give me Body Corporate fees anytime.

I’d never thought of it like that before.

I wonder if the Gold Coast market is different to Sydney and Melbourne in this way. I think it is…

Our apartment is not fancy. It is a 3 storey walk up with 15 units, a pool and fairly small but well maintained garden surrounds. The strata fees per year is $3,225.00.

It is rare to find houses here that are older than the 60s…as far as I know, there WERE no proper houses here before the 60s! Would a 60s style house really require that much maintenance expense every single year ongoing? I doubt it, however you also have to add on building insurance to a house, whereas it’s included with your strata fees. Hmm.
 
You also don't need to have building and liability insurance because body corp are paying it ;)

I laugh when owners say they don't have to pay for something because the Body Corporate pays for it, and it irritates me when obtaining quotes from contractors when they tell me not to worry about the cost of something on common property because the Body Corporate will pay for it. The Body Corporate is YOU!!!!!!!!!! It is the owners who put the money into the Body Corporate bank account.

As an executive committee member I can easily see how strata fees are so high. Those that do repairs or supply services to strata properties know that half the residents are tenants and therefore couldn't care less, half of the remaining owners would not get off their a** to save themselves in a fire, and most of the remainder would not know a reasonable quote from a dear one or a good job from a bad one. I know the expenses would be a lot higher here if not for the efforts of myself and another owner - and keeping it tidy. It is so frustrating, but unfortunately everyone benefits just so I can benefit (which really is not economical)

To give you two recent examples of quotes from tradies the strata manager sent around:

job A. quote 1; $10k, quote 2 $2,500 quote 3 $2200
job B quote 1 $1900, quote 2 $1400, quote 3 $900. As this was only one days work we laughed at all these and arranged our own for $600 - which was still a bit steep for 1 days reasonably unskilled labouring work.

It appears a lot of tradies are just picking figures out of the air these days (especially for strata jobs) and is not related to materials and time on the job + incidentals - even at $100 p/h.

We have had so many problems with contractors sent around and recommended by strata managers. When we complain we are told they have not had any problems before. This would appear to be because most people don't know when the job had not been done poorly and therefore are happy with the work and don't complain. In the past we have even had a strata manager still give work to a painter while at the same time trying to get him to fix up problems with his work at our block, incl pursuing the matter with DFT!! Use strata managers recommendation with caution.

When speaking with REA re strata levies for properties they are selling, they say it is the properties where the owners that get involved in the day to day running that have the lowest levies. This fits with my experiences!

Apologies for anyone offended by my generalisations.:)
 
We have owned units.

The best advice we were given regarding fees was to look at the property manager situation. Resident manager salaries are usually the highest expense, so we were advised to choose either a small complex of 6-8 units with no manager, or a complex of 40+ units to share the cost of the resident manager. Complexes of 15-20 with a manager are a recipe for disaster, as the cost of the salary is spread too thinly equalling high BC fees.

In the end we bought two units, one in a block of 8 without a manager, and one in a block of 80 with pools and resident manager.

Both strata fees were extremely reasonable and both properties gave us good capital growth which has equalled houses we have owned. Maybe we were just lucky?????

Every body corporate produces annual accounts which detail exactly how YOUR money is spent.
Marg
 
I also found this ridiculous when looking for a property last year. It actually turned me off of buying an apartment.

One I looked at in Erskineville had $1200/quarter body corporate fees and it didn't have a pool, gym or any extra facilities besides an elevator.

If you're not careful with these, they can be a huge ripoff.

Even if it does cover costs of gym/pool etc you could easily get a great gym membership with pool access for $100/month which far less than any body corporate fee.

Not to mention, if any unexpected repair comes along, they will raise the body corp fees to cover it.
 
It comes down to if you want to be hands on and keep prices down such as in a house where you deal with repairs yourself and arrange your own repairers, or sit back and leave it to a strata manager to look after repairs and possibly pay a lot more for the same job because the tradies know they can get away with it due to less scrutinising. I reckon in our block we saved $25k over 18 months on numerous jobs by preventing some of the useless Executive Committee members of the time (who had NFI) paying too much for some jobs and having work done that would not have solved the problems. A smooth talking tradie who can get an executive on side (won't mention what sex ;)) can name his price and know he'll be called back time after time regardless of his prices.
 
I wanted to post into this thread so badly that I went and joined up just to have my say. (I know I will enjoy great benefits so I would have joined anyway).

I've recently been looking at apartments in the Sydney CBD and even after reading all the comments in this thread I am still disillusioned by the extreme costs of strata fees in the CBD. I compared units on the other side of the Harbour Bridge in Neutral Bay and found them to be 50% or more cheaper for comparable apartments. Case in point is a unit in World Square. Strate fees on a 1 bedroom there is around $8k per year, 2 bedder around $10k. There are 78 levels of 6 apartments (I'm guessing) per floor. For ease, let's average it out at $9k per year. A quick calc tells me this complex is charging $4.2 million per year in strata fees. Call me crazy but there is no way you could spend that on maintenance/sinking fund. I would of expected with more apartments in the complex, the fees would be way lower.

The similar complex in Neutral Bay (not as high of course) is less than half and on a pro-rata basis would have similar expenditure items.

Is it something to with the fact that you are on the other side of the harbour that the costs go up for some reason? There must be something I'm missing cause I still don't understand how two similar units would have such drastic differences in yearly costs.

I haven't provided links but you can search apartments for sale in these areas on "those" websites.

Dave.
 
Compare a unit with B/C fees of $2000 a year and rates of $1,500 a year Total $3,500 a year) to a house that you don't have B/C fees but have rates at $2000 a year

:confused: We owned a unit in Brisbane and a townhouse in Newcastle and the rates were NOT included in the BC fees - they were yet another added expense. Water was also not included in the BC fees.

If you can afford a house - buy a house. Just my 2c (from experience).
 
Welcome GetRichSlow,
Maybe they have upped the fees for some upcoming expense.
A friend of mine live in an apartment in Darlinghurst. It's a boutique apartment with units worth over $1.5m. A few years ago they had to replace all the windows. The special levy cost him $90,000. Just hiring the crane was $200,000.

Beachside I have seen similar things with quotes. Also with shoddy jobs. Lots of jobs are done and the BC just sign off on it. At one place I own a security door was installed and they obviously measured it wrong so to make it fit it was on an angle. Looked terrible. But someone had paid it without even looking at it.

Another BC was about to approve a single quote and I disagreed and asked for more quotes (I had just bought it and it was my first meeting):D. The next 2 came in at half the cost. EXACTLY the same materials. Nice save, even if I say so myself.:D
 
Please tell me that you are kidding.

The age old complaint about Body Corporate fees really amazes me. The only difference between Body Corporate fees and basic house maintenance is that with Units, you actually know in advance what your bill is going to be.
With houses (especially old ones) you just keep dipping into your back pocket to pay unforseen bills.

When you compare Strate fees to the cost of running a house over 12 months, in most cases the unit will come out cheaper than the house.

Compare a unit with B/C fees of $2000 a year and rates of $1,500 a year Total $3,500 a year) to a house that you don't have B/C fees but have rates at $2000 a year Building Insurance at $500 a year plus all of those unthought of expenses like garden maintenance ($500 a year), painting $15,000 every 10 years), fence maintenance ($2000 every 10 years), rubbish removal ($50 a year), Roof and guttering maintenance ($10,000 every 10 years), Pest treatments ($300 a year) - What are we up to now? Around $6,500 a year.

Give me Body Corporate fees anytime.

Interesting way of looking at it.
But there can be additional levies too, right?
I looked at a unit in a complex of 24 units and the additional levies added to $19K in 3 stages (for changing windows, upgrading balconies, and upgrading the lift).
 
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