Buying a unit or other community title/strata property (such as a duplex or part of a development) is not the same as buying a freestanding house.

Many people don’t realise that the differences don’t end with the contract.  They think that they can live in the unit the same way they can live in a house, but this is a recipe for disaster.  Buying a unit can come with some unexpected – and often unpleasant – surprises.  Here are 5 things you should know before you buy a unit.

1.   You can’t just renovate or change parts of your unit or the building without permission from the body corporate.

Do you want to cut a hole in the wall of your unit to the outside to install an air-conditioning system?  Think again.  Anytime you want to do anything that changes, damages or removes common property, you need permission.  This can include major internal renovations such as kitchens and bathrooms as well.  You may also be restricted on painting the outside of your unit.  You will need permission and may be limited to designated colours.  You need to check the community title plan to see what is lot property (your property you can do what you like with) and what is common property (property that belongs to all the unit owners jointly).

2. There could be hidden defects.

A nice new unit might look great on the outside but there can be hidden defects in the unit or in the common property which can be extremely expensive.  Things like water penetration, concrete cancer and substandard workmanship can keep itself hidden long after the defects period (when you can claim against a builder) has expired.  This can mean a special levy (on top of the levies you already pay) to pay to fix these defects.

3. You need to make sure there is enough money in the administrative fund and sinking fund to deal with issues that come up.

The ongoing levies you pay as owner of a community title unit go towards maintaining the common property.  If the levy isn’t high enough, which might be initially attractive, then you are just going to be paying for it later.  Make sure you consider the age of the building, any repairs or concerns that have been flagged in body corporate meetings and any ongoing maintenance items (such as lifts, swimming pools, etc.) which can become more costly over time.

4. Be aware of existing liabilities.

Carefully check the minutes of the recent body corporate meetings.  If the body corporate is being sued for a slip and trip on the stairs or for damage to a neighbouring property due to a poorly maintained retaining wall, you want to be aware that this could become very expensive to unit owners who may have to contribute to extra levies.

5. Check the by-laws to make sure you can live with the rules.

Community title by-laws can be wide reaching and sometimes strange.  For example, pets may not be permitted, which means you can’t keep you cat or dog in your unit.  You may not be allowed to hang your washing out to dry on your balcony.  You may be limited in the colours you can use for your curtains.  One high rise building in Sydney specifically prohibits the installation of air-conditioning units above a certain floor.  Before you buy make sure, if you are going to be living there, you can tolerate the rules.

Most of the above items can be easily discovered through getting suitable searches done on the property like vacation homes on Hilton Head Island before settlement.  Even better, make it a condition of the contract that you are satisfied with the searches so that you don’t have to commit to buy if you discover something you don’t like. When considering buying a unit or community title property, it pays to spend the money up front to avoid a disaster down the track.

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