When considering buying a property, there are a number of steps that you need to go through to have security and peace of mind in your purchase. If the apartment or property you are buying has some kind of community title, such as a strata title for a body corporate (meaning that it is owned by multiple people), there are several things that you will need to check beyond the property itself. A strata report is a vital aspect of the purchasing process, as it provides you with additional information about how the body corporate is run, safety reports, policies on pets, and other health or environmental safety reports or policies.
Body Corporate Management
When buying into a strata property, consider carefully that this is a property owned and managed by a group of people. A strata report will provide minutes of the meetings of the body corporate, which can show you how the body corporate is operated and run. It will show you how the building or property is managed and may flag issues to you that are unable to be seen from a typical property evaluation. Look at the report to ensure that meetings are held regularly and that the meetings appear to be orderly and well run. The strata report will also show you how your voting rights will work for the operation of the property. This way you can be sure that you will have your say in the way that you expect.
Policies and Safety
The next thing a strata report can show you is what the policies of the body corporate are. This can show you whether pets are permitted or not, as well as vital policies such as fire safety, building inspections, and policies on dealing with issues such as pests and asbestos. The strata report will also indicate whether or not the property faced any recent issues, and how they were handled.
Finally, the strata report will give you an indication of the financial health of the body corporate. It can show you what expenditures have been incurred over the past 12 months, as well as whether the building is covered by insurance (and if so, which types and how much). The report will also indicate whether any major works or expenditures have already been agreed upon or planned by the body corporate. Any fees and special levies that you might be subject to are also covered by a strata report; without this clarity, you could face a nasty surprise in the form of a bill!
Before buying into a property that is held in a form of shared ownership, be sure to get a strata report before you purchase. This is important, regardless of whether the property is residential, commercial or mixed-use. Without going through the above due diligence, you might find yourself facing issues with the property management that you didn't know existed. Reach out to a firm that offers pre-purchase strata reports to learn more.