Cost of Strata Inspection Could Save Thousands Later On

Buying into a group title scheme is an excellent way to get a foothold in the property market for both owner-occupiers and for a rental investment. For busy people with no time to look after a house on a suburban block and for first-home buyers with small deposits, units and apartments are practical and affordable.

As with any major purchase, however, caution should be exercised. Before signing any contracts, intending purchasers should commission a strata report and have an inspection done, not only of the property they are interested in, but the entire complex. The initial cost could save thousands in the long run if the report and inspection show a building in decline.

Poorly Run Schemes will Show up under Scrutiny

Many apartment complexes outsource the running of their building to companies like ours. At WA Strata Management we offer a full service to our clients to ensure that their building investment is well managed, fully maintained and financially sound. Unfortunately, there are some that have not been professionally run, and it is these types of properties that a strata report will identify.

It is surprising the types of issues that come to light under the scrutiny of a thorough investigation. Disputes between neighbours, poor maintenance that impacts on the comfort and liveability of the complex, financial mismanagement requiring increased levies, and inadequate building or liability insurance are all serious matters that can cause financial loss.

Report on Financial Status, Levies and a Long-Term Budget

The report should reveal the scheme’s financial status, the current levies, any special levies that have been passed, any upcoming and past building work and all the expenses paid out over the past two years. There should also be a ten-year budget plan so that current owners and interested buyers have some assurance that known circumstances have been identified and allowed for.

Well Maintained Buildings Hold Their Value

It has been our experience that a building that is well-run and financially sound holds its value in the market, and this is why for a first-time investor, this type of report is so important. Buying into a group scheme that has not dealt with problems that go back years will have a financial impact. For example, any unexpected increase in levies could jeopardise the income needed to service the mortgage.

Buyers need to know if building defects are being addressed, or if the complex meets safety and council standards. Has there been a history of disputes between the owners and the people running the complex? If so, are the bylaws too restrictive? Is it difficult to get approval for renovations?

Professional Management Protects Everyone

All these issues should be dealt with immediately they arise. This is why more and more strata schemes are engaging businesses like WA Strata Management to run their affairs. We know the relevant laws and our staff are experienced in dealing with any issue immediately. This protects the value of the whole property and gives buyers the confidence to step into the market.