The Importance of Strata reports
Buying an apartment, townhouse or villa can be a cost effective and convenient way of getting into the property market. However it is essential to obtain and properly understand the Strata report.
What is a strata report?
Strata reports provide details of the collective aspects of your prospective purchase. This should include information on levies, by-laws and lot entitlements, details of funds held for short and long term maintenance and minutes of meetings which might point to future costs.
Is it necessary to get a Building and Pest report as well as a strata report?
A Building and Pest report can be carried out, but is largely unnecessary as this will only pick up on information within the apartment. Keep in mind the only things you will be responsible for fixing are cosmetic aspects; something that you can investigate just by looking over the property carefully.
How do I obtain a strata report?
There are three ways to obtain a strata report;
- Conveyancer - your Conveyancer should be the first person you speak to about this as they will be the most cost effective and the easiest way to obtain the information. They will also know what to look for within the report
- Strata Investigation Company – there are specialist strata investigation companies who can prepare a report, however this can be more expensive
- Strata Manager – you can book in a time with the Strata management company to go over the accounts, Annual General Meeting notes and by-laws yourself. There is usually an hourly charge for this.
How much does a strata report cost?
Strata reports can vary in price from $150.00 - $250.00
What should I look for in the report?
- Who is the current owner?
- What are the quarterly levies for the property?
- What are your voting rights? What is your unit entitlement?
- When are the levies paid to?
- Have they been paid up to date?
- Are there any current or proposed Special Levies (additional contributions outside your quarterly levies that may be raised for building defects or major works)?
- Does the Strata Scheme comply with Fire Requirements, Work Health & Safety Obligations and Asbestos Management?
- Has the building had any problems with pests or vermin?
- Is there any information in the records approving animals? Are animals permitted?
- How much is in the sinking fund and Administrative Fund?
- Are any of the funds in deficit?
- Are there any current legal matters?
- Have there been any legal matters in the past 3 years?
- Building defects or Home Owner Warranty Claims for defects
- Breaches of By-Laws (Rules and Regulations for this building)
- Is there any disharmony between owners or tenants?
- Major Income and Expenditure over the past 3 years
- Proposed Major Expenditure
- What is the current value of the building?
- Is the building insured and, if so, adequately insured? (details of the insurance and cover)
- Are there any compliance related matters within the records such as window and balcony compliance?
- Is there a Sinking Fund Forecast? (a report prepared detailing what the levy contributions should be over the next 10-15 years including detailed maintenance)
- Are there any known disputes within the Strata Scheme or complaints about the strata manager?
- Copies of Annual General Meeting Minutes, Extraordinary General Meeting Minutes and Executive Committee Meeting Minutes
- Copies of building reports, extracts from compliance reports
by Tanya Demello on 21 November 2014
Filed under Places