This article about whether a landlord can access building facilities like the gym or pool while they have their apartment let has been supplied by Karina Heinz, Progressive Strata Services and Tyrone Shandiman, Strata Insurance Solutions.
Question: My apartment in a multi level apartment complex is let for 6 months. As a landlord, am I able to still access the amenities like the gym and pool while my apartment is rented?
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I am an owner of an apartment in a multi level apartment complex. I have a tenant in my apartment under contract for 6 months.
As an apartment owner I am continuously paying strata levies. As a landlord, do I relinquish my right to use the amenities like the gym and pool while my apartment is rented?
Is there a Strata law that prohibits me from using the apartment amenities while my apartment is currently rented?
Answer: Removing a member should be done cautiously so take the time to try to set it up properly.
Karina: I don’t think there is a strata law that covers this. It is generally covered by smart scheme’s via a bylaw – the question is then is it reasonable?
I think one has to appreciate that potentially the facilities are then being used twice as much and thus the wear and tear will be more. Is that fair? If it was someone else doing it, would you be OK with it? The owner is essentially getting double the benefit for the same cost (levy).
I think the bigger question is – are the owners covered by the scheme’s insurance if they are not a resident? I wonder too about the Tax implications. If you are making money renting the apartment out, are you not also getting a benefit (like fringe benefit on a car) by using the facilities instead of paying for them elsewhere?
Tyrone: This is a very interesting scenario.
The policy covers the owners corporation’s interest and does not actually cover the lot owner (owners need their own landlord’s insurance). There are no exclusions in the policy that specifically deals with this scenario. From the insurer’s perspective, the building is being used for residential purposes.
What are your thoughts? Should a landlord access building facilities while they have a tenant residing in their apartment? If you have a question or something to add to the article, leave a comment below.
This post appears in Strata News #301.
Karina Heinz
P: 02 9389 9599
E: [email protected]
W: https://www.prostrata.com.au/
Tyrone Shandiman
Strata Insurance Solutions
T: 07 3899 5129
E: [email protected]
This information is of a general nature only and neither represents nor is intended to be personal advice on any particular matter. Shandit Pty Ltd T/as Strata Insurance Solutions strongly suggests that no person should act specifically on the basis of the information in this document, but should obtain appropriate professional advice based on their own personal circumstances. Shandit Pty Ltd T/As Strata Insurance Solutions is a Corporate Authorised Representative (No. 404246) of Insurance Advisernet Australia AFSL No 240549, ABN 15 003 886 687.
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Seems like this is a bit of a grey area with arguments both for and against. Is it something that just comes down to individual body corps?
Be careful if your property is owned by your SMSF then you will need to be very careful about making personal use of any facilities. Check with your own accountant.
Hi Abi, you sound like a person with a legal background.
Can you please point out to me where particular in any LAW or LEGISLATION does it say that “when a landlord rent his apartment, “the owner has effectively signed away their right to use the common property whilst the tenant is in place.”
You’re right, it’s not spelled out in any😔😔😔!
This is an interesting topic. I am an owner of numerous apartments in the Melbourne CBD. I knew the building and strata managers and I never have an issue of using the building facilities whenever I visit my apartments. The body corporate feels they have no legal right to prohibit and enforce an owner using the building facilities and amenities in which he/she is paying for the levy and not the tenant. Having said the above, here’s my questions:
1. Does the body corporate have the right to eject / remove an owner (thru a building manager) using the pool/gym if his apartment is tenanted?
2. Can a tenant invite for example, a dozen people as his guests and to use the pool and barbeque area during this time?
3. Can an owner exclude and prohibit his/her tenant from using the apartment facilities thereby by doing so, the owner can have complete access to the facilities?
4. As an exemption for item 3, can an owner give a written permission for the tenant and tenant’s guests to use the apartment amenities, on certain and specified date/dates?
5. What is the power of the building corporate to enforce the owner who is not a resident To be removed from the building facilities. Can the owner be forcibly removed or can a police be called if the act is illegal???
Looking forward to your reply.
I think it comes down to the tenancy agreement. The owner has provided exclusive use of the property at a long term tenant. This would obviously include any common property rights. As such, the owner has effectively signed away their right to use the common property whilst the long term tenant is in place.
In my tenancy agreement with my tenant, I included in a special clause that using the building facilities is not included. I pay the levy, I use the amenities. I can only give the tenant a written permission to act as my guest from a specified prearranged time and date.
There is NO law that says an owner would “effectively waive or lose his RIGHTS to use the apartment amenities in which he is the one paying for the levy and not the tenant, if ever he rents his apartment.”
Landlords need to make a choice – let their tenant use the common property facilities and stay away themselves, or the opposite: maintain use by the landlord and cancel access by tenants in which case a reduced rental might be negotiated. What’s next ? What if the landlord parks in a visitors space when using the gym ? is he then breaking a parking By-Law ? How may landlords does it take to take up EVERY visitor space and double the usage of the gym ? A non-resident landlord is operating a business of sorts when he rents his property. He is not a resident and unless accompanied by the tenant at the tenants invitation on every occasion that he visits the gym, then he should have no rights to be there.
Yes, the landlord’s choice at this instance can be to cancel the right of the tenant to use the amenities.
Phillip touches on the tip of an iceberg here. What’s fair and reasonable v what actually happens.
Use of an apartment for ‘Residential Use’ precludes short term letting of any kind. Independent studies for the A.B.C.B. (ie Phillip Chun Report) indicate maintenance costs for residential (Class 2) and Holiday let (Class 3) buildings is approximately 40% higher for the later.
Those who holiday let lots in a residential apartment are being subsidised by the only LAWFUL USERS – Residential Users.
Now take a peek at the exposures to $1.2M in penalties around s164 and s165 of Planning Act (Qld) 2016.
Ever wonder why the self proclaimed legal experts who regularly comment keep a lid on this? A: Follow the money through what is refer to as ‘The Industry’ – an industry funded entirely by the levies and wallets of the owners of the residential property.
Good morning Nikki,
On another matter, namely the Sinking Fund.
I live in a small (41 lot) scheme where there is some confusion about the level of funding required to maintain a SF compliant with legislation. Our scheme does not have an on-site manager, but is simply run by a committee (7) and a Body Corporate Manager.
Our SF forecast is to be put to the next AGM and there are several suggested increases ranging from 20% to 46%.
My question is, does the legislation have any specifications for maintaining a healthy SF?
Regards …… LaurieM
Hi Laurie
Just checking you are talking about NSW Legislation in this instance?
Thanks
Nikki
Great Q&A and there is a further scenario whereby an owner (landlord) is short-term letting an apartment in a complex with a gym and/or pool, either through a platform like Airbnb or a licensed holiday letting agreement. If the owner resides locally in a separate dwelling, and wishes to utilise the facilities when the apartment is vacant, then the ethical issues noted above about fair wear & tear, ‘double’ benefits and making money from the apartment whilst concurrently using the facilities are mute (if the apartment is vacant when they are on-site). Noting also Tyrone’s comments about insurance, and if there are no By Laws to the contrary, I see no issues with the reasonable and pragmatic use of the facilities by owners / landlords?
Agree on your comment, Phillip. Except if there is a By Law prohibiting the use of building amenities by owners while their property is tenanted, how can this be enforceable? Is this even legal? Is this covered by legislation? Thanks.