Should You Buy a Property With a Body Corporate
We often get negative feedback from potential buyers about the cost of the body corporate fees when we are marketing apartments.
What is a body corporate?
A body corporate is a legal entity made up of all the owners within a unit-titled property.
A body corporate is responsible for the management and maintenance (including planned maintenance) of common areas and facilities, such as lifts, swimming pools, and gardens.
A body corporate provides a range of benefits to unit owners.
It ensures that common areas and facilities are well-maintained, which can increase or will at least help maintain, the value of the property.
To this end, they are now required to have a long-term maintenance plan to ensure the building and its common areas are properly maintained.
This plan is required to cover a ten-year period.
The body corporate also covers the cost of insurance for the building and all common areas, and it provides a sense of community and shared responsibility among unit owners.
Main criticisms of body corporate
One of the main criticisms of body corporates is that they can be expensive, especially in older buildings.
Unit owners are required to pay levies to cover the costs of maintaining common areas and facilities and these levies can be significant, particularly if major repairs or upgrades have been deferred in the past.
Additionally, some of the larger body corporates can be unwieldy and unaccountable, with some unit owners feeling that they have little say in how the body corporate is run.
Steps to help you with buying a property with a body corporate
If you buy into an apartment block we strongly recommend that you first ensure that there is a recent long-term maintenance plan in place and that there are sufficient funds available to implement that plan.
Then either join the body corporate as a committee member, or at the very least attend all of the annual general meetings. Your apartment is likely a major asset if not your largest asset, so it pays to have some form of control over its upkeep.
If you compare the cost of a body corporate levy to the overall cost of maintaining for example a 100-year-old villa, you are likely to find that the body corporate levy is quite reasonable!
Lisa and Steve Stone
Elite Agents for Ray White