Apartment body corporate due diligence

[prop.io]

If purchasing an apartment what due diligence should be conducted in relation to the Body Corporate. What is your must check list of items?

[artemis]

There are a few threads on this.

There are several legal requirements for BCs, set out in the Unit Titles Act, so they should be the start of a checklist. Then read in detail the last few years of minutes and accounts, carefully reading between the lines! If there is a BC management company, check it out. If they were appointed by the developer check that the company can be removed if the owners wish. There have been a couple of expensive court cases in this situation.

Check how water supply is paid for the complex. Check out the Zest complex water issues for example.

Unit titled complexes can be a hotbed of tricky issues, especially if owners are not also residents- not just financial and maintenance but interpersonal as well.

I had an apartment in a block of 4. All owners were sensible but there were still some gnarly issues and not all were on the same page. My solution was to buy them all out and run the BC myself. Sorted.

I wouldn't go into a BC situation again. (Unless I was buying the building!)

[Wayne]

Read everything you can from the BC - all the minutes etc.
Talk to the people who own if you can (just remember some may have a beef of some sort so you have to temper what they say (good or bad)).
artemis is right.
There are many issues brewing around the place - people are buying more apartments but BC's aren't well understood by most.

[Maccachic]

Check the maintenance plan is done well. Few issues arising now because of sub standard maintenance plans and find out how it is funded (if at all) and what expenses are coming up - some opt to leave out costing's which can make it harder.

[artemis]

Also, a good idea to knock on a few doors and ask about noise and BC issues. We did that once, the neighbours responses were very different to the official version. That was the end of that story!

[Davo36]

After having owned an apartment in town and been on the BC committee for that, I can say the above comments are right. I'd be very careful about buying one again and I'd do this due diligence (some of it repeats of what others have said):

1) Read all BC minutes for the last few years. But I know for a fact things will be left out. Try and speak to the BC chairperson or at least one of the committee members.

2) Look at the financials, i.e. the bugdet for the current year and last few years, so the items look reasonable?

3) Look at the long term maintenance plan and see what big items are coming up. And how much is in the long term maintenance fund for this. Exterior painting. lifts, air conditioning, emergency power systems, roof cladding, swimming pools and a long list of others are all expensive things to maintain and replace.

4) Be especially careful of exterior cladding. Go and actually touch it and find out exactly what it is.

5) Find out who built it and find out about their record and whether they're still in business.

6) Find out about utilities like power, water, telephone (fibre?), gas etc. Are they separately metered?

[primal]

Buying off the plan from well known developer is the way to go

[eri]

a well known developer?

like multiplex?

known world-wide!

but the nz arm still went down in 2013

http://www.nbr.co.nz/article/brookfield-multiplex-cites-lack-projects-liquidation-nz-unit-bd-134381

if i'm buying bricks + mortar

that's what i'm buying

not pie in the sky

[Davo36]

Buying off the plan from well known developer is the way to go

Utter rubbish.

[eri]

granny herald is going from bad to worse!

is this story about registration of property managers

as the title says

or registration of body corporate managers

as the text seems to imply?

http://www.nzherald.co.nz/property/news/article.cfm?c_id=8&objectid=11542561

[Davo36]

Property manager, Body Corp manager, all the same to the Herald...

[artemis]

Property manager, Body Corp manager, all the same to the Herald...

Byline Anne Gibson - she is their property editor so I am sure she knows the difference. Subeditor? Does the Herald still have subeditors? Not a lot of evidence of it.

Or maybe looking for a wider audience - rental owners as well as unit title owners.