Question: We are looking into re-calculating unit entitlements at our Class B complex in the ACT. Can you provide any advice about this matter and an estimate of likely costs?
I have argued that re-calculating unit entitlements at our Class B complex needs to be done because between a quarter and a third of the 105 units here (many different designs) have had major alterations or extensions done since the original construction in the mid- to late-1970s.
Our OC Executive Committee asked (indirectly) for me to obtain a quote for the cost of having this done. I have advice from the ACT Land Titles Office about their fee for registering a new schedule of unit entitlements, and that paper title deeds for units no longer need to be produced, but apparently we would still need to get a professional market revaluation done of all our units. This is still a difficult and expensive exercise.
Can you provide any advice about this matter and an estimate of likely costs?
Answer: This will not be a cheap exercise and a lot of hurdles to get over.
This will not be a cheap exercise and a lot of hurdles to get over.
You really should be obtaining advice from your paid Strata Manager. The Owners Corporation may also need legal advice plus a surveyor and valuer.
We would recommend you contact Deb Barnes of Capital Crown Leasing P/L. Deb may be able to assist.
The Owners Corporation needs to weigh up the cost over benefits. If this is a Class B complex then all owners share the same common property. Upgrades do not necessarily add a large increased value to the unit as normally the footprint remains the same. In an insurable event the majority of insurance policies have additional cover of $250k per unit for owners fixtures and fittings.
EG: If the value of a unit has increased by say $250k. The additional cost on an insurance premium would be $300 to $400.
Changing the Unit Entitlement could most likely cost you more than this each year. As the unit owner you still maintain your own house so that is not costing the Owners Corporation additional monies. Amendments to the Unit Titles Legislation allows an Owners Corporation to bill an owner for any additional costs incurred by an owner to the Owners Corporation.
The OCN had an article on their website but prior to the new regs: Reallocating unit entitlements
Jan Browne
Bridge Strata
E: jan@bridgestrata.com.au
P: 02 6109 7700
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