Posted by admin on 12 October 2009
There’s a big gap in our state’s property industry – body corporate information. Real estate agents get no training so few can explain anything to buyers. Solicitors compete heavily for very price sensitive conveyancing so don’t have time.
So most apartment owners receive their first wad of paperwork and voting papers with little idea of how it all works.
We recently held the first in a series of free seminars to help change this. If you’d like to read the notes download it here, or email us at rsvp@beesnees.com.au if you’d like info on upcoming sessions.
Tags: body corporate issues Queensland, Brisbane real estate agents
Posted in Brisbane landlords, Brisbane's sales market | No Comments »
Posted by admin on 14 August 2009
Buyers often ask us if they’ll be able to bring their cat or small dog to their new apartment or townhouse. Pets in apartments can be a touchy subject with plenty of emotion, and lately we’re seeing more buyers that are simply not happy to accept a body corp’s rejection of their moggy or mutt.
So can a body corp of current owners reject a pet? In many cases, no.
Each building has its own by-laws that apply and if they state “no pets” then that’s pretty clear. (Other than for guide dogs.) The majority of by-laws have wording to the effect that the committee must approve any pet application – and in some buildings the owners enforce a no pets policy by rejecting all applications out of hand.
This is the area that’s creating waves right now.
In one landmark decision an adjudicator with the Queensland Body Corporate and Community Management Commissioner’s office forced a committee to approve a cat. The Southport apartment owner suffered depression and had a doctor’s letter supporting the animal as a companion and “part of her therapy”.
The adjudicator noted that the by-laws said a pet could be kept with approval. “This means that the committee cannot simply adopt a “no pets ” policy but must exercise the discretion to approve a particular animal after consideration of the individual circumstances.”
Committee members should take care with this tricky topic.
Our main concern with body corporate law in Queensland is the lack of info and knowledge. Property owners don’t have easy access to it, most real estate agents know little so they’re not educating buyers, and most conveyancing lawyers give only a brief outline unless asked.
If you own a property in a body corp and have minimal to zip knowledge of the legalities don’t be embarrassed. You’re in good (and plentiful) company!
Commencing in September Bees Nees City Realty, in conjunction with Brisbane’s Stansure Strata Management, will be running a series of small seminars on some broad body corp topics. Insurances, getting involved in your committee, understanding your AGM agenda and budgets. The evening seminars will be held at our South Brisbane office and will be free of charge.
If you’d like more info email rsvp@beesnees.com.au
Tags: application for pets Brisbane, body corp committee Queensland, Body Corporate and Community Management Act Queensland, body corporate issues Queensland, by-laws Queensland, pets, QBCCM Commissioner
Posted in Brisbane's sales market, Inner Brisbane events, trends in Brisbane property | No Comments »
Posted by Rob Honeycombe on 25 February 2009
We’ve all had days when our neighbours get under our skin, but police are investigating an argument and weapons incident in a Gold Coast penthouse apartment last Thursday that’s apparently all about body corp fees. And this issue is one that all apartment and townhouse owners need to know about.
Imagine for a moment you own a 1 bedroom apartment and your body corp fees rise by 70%, effective immediately. Why? The penthouse owner believes the sharing of building costs isn’t fair, and has been handed a fee reduction. Queensland’s Commercial and Consumer Tribunal has dozens of cases before it (2 were heard in Brisbane last week alone) where apartment owners are asking for a cut in their fees, at the expense of their neighbours. And in almost every case they’re successful.
The Body Corporate and Community Management Act calls for all owners to pay equal contributions to the running costs of a building/community (through “lot entitlements”) unless it’s “just and equitable” that they don’t. In recent hearings the Tribunal’s saying the property’s size, height and number of bedrooms aren’t relevant to the fees you should pay. Trouble’s brewing because most buildings’ lot entitlements were set prior to the Act kicking off in 1997 and there was no previous requirement for equal numbers. Entitlements were usually set by value of the apartment, so 1 bedders on a low floor often pay a lot less than 3 bedroom penthouse at the top.
The 2004 appeal to our Supreme Court known as Fischer v Centrepoint Apartments was the important test. Fischer, a Spring Hill penthouse owner, trounced his neighbours and got his fees reduced, this precedent opening the door for any aggrieved owner to simply submit a $200 request to the Tribunal to lower their fees.
If you buy your apartment with fees disclosed up front, shouldn’t you be bound by them? How can an owner buy with certainty if their neighbours can ask for a rule change at any time? Given the law changed in 1997 should earlier buildings be ‘protected’ (they’re not now). On the other hand, why should some owners effectively subsidise their fellow owners’ building expenses?
Neither NSW or Victoria regulate the setting of lot entitlements and, if appealed, the value of the apartment is relevant to the Tribunal decision. Are Queenslanders determined to be “more equal”? And how many more apartment owners will see their fees leap up before the government fixes this mess? We don’t have the answer but this is a prickly issue that won’t go away. Even before last week’s shooting the Attorney General had issued a discussion paper on the problem and submissions close this Friday.
And for those buildings where the fees have already been adjusted by the Tribunal? Must be fun sharing the lift…
Tags: body corporate issues Queensland
Posted in property taxes and rates etc, trends in Brisbane property | 2 Comments »
Posted by Rob Honeycombe on 18 June 2008
City Council rates for medium density housing are set to leap from January 1st when a rather odd new rating system kicks in. Last week’s BCC budget outlined a new loading on units, townhouses and apartments, with the Lord Mayor arguing these properties aren’t yet paying their fair share. According to the Unit Owner’s Association the annual bill for one inner-city apartment will jump from $1300 to $2400, and there’s no doubt these costs will be passed on to tenants in higher rents. It’s hard to imagine the government adding an extra excise to petrol prices right now – imagine the outrage that’d cause. Yet this rates slug seems like the housing equivalent in a market already struggling to cope with falling affordability, under supply and interest rate rises.
Council has to consider “capacity to contribute” when charging rates, and it’s true apartments have generally paid less than houses. But we’d argue there’s plenty of benefits to the community in encouraging apartment dwellers, including more efficient use of amenities like roads and parks. Isn’t it a little ironic the same budget that goes a long way to easing Brisbane’s traffic congestion with record infrastructure spending also penalizes those who live closer to the city and make less use of it!?
The new calculations are complex and if your apartment sits on a block of land worth over $1m you’ll cop a “luxury apartment” loading. Across the inner city that’s pretty much your typical 6-pack and over, (plenty of them aren’t too luxurious!) and the dearer the block the higher your loading. Remember these are values set by the state government and often regarded as irregular and unreliable. But the real sting is how the value of your block of land is split amongst each owner. The state’s body corp legislation says the shares (interest entitlements) must be equal unless there’s a good reason otherwise. So while the Lord Mayor targets “capacity to contribute” the very laws he’s using to calculate the rates split say this notion’s not relevant. In recent years penthouse owners have sued their own body corps to reduce their “unfair” entitlements and developers have been scared into keeping them fairly equal when setting up new buildings. So 1 bed apartments and 3 bed penthouses often pay similar rates bills.
The net result? Smaller apartments across the inner city are about to cop more than their fair share of yet another increased cost. And these are the homes most likely to be rented.
Tags: body corporate issues Queensland, Brisbane apartments, Brisbane City Council, tenants Brisbane, Unit Owners Association Queensland
Posted in Brisbane landlords, Brisbane's rental market, property taxes and rates etc | No Comments »
Posted by admin on 27 March 2008
Tucked in with the mailman’s delivery of Easter cards, this year’s land valuation notices held a sting for plenty of inner Brisbane property owners. These are the official numbers the state government assigns to every piece of real estate, and they’re used to work out how much you’ll pay in Council rates and, for a large number of property owners, land tax.
In South Brisbane we’ve seen a number of jumps over 50% in just one year, with one Peel Street property (Soho Apartments) rocketing 74%. Across the whole city we’re told the rise was a to-be-expected 16%, but the department confound us each year with their process. The “unimproved capital value” (see your UCV on your BCC rates notice) is supposed to be based on the notional value your land would be worth with no building, fences, levelling etc. So to determine this they look for recent sales in your area of vacant or “lightly improved” properties and work back from there. If anyone’s seen any vacant land selling around the inner city let us know…
If you own an apartment you won’t get the notice as it goes direct to the body corp. But you will get the rates and land tax increases that result. If you own at Aurora Tower or Oxygen Apartments your taxable value just leapt 29%; Que and Greenwich at South Brisbane were up 53%. Might be worth asking your committee if they plan to appeal the amount?
Land tax kicks in as soon as you own property worth a combined $600,000 (or $350,000 if held in a company name), so for many inner city suburbs that’s just one property! You don’t have to be a wealthy old landlord to be copping this state tax.
The outcome? Higher costs of owning real estate and higher rents for tenants.
Tags: Aurora Tower Brisbane, body corporate issues Queensland, Brisbane City Council, Brisbane property valuation, Greenwich on Cordelia South Brisbane, land tax, Oxygen Apartments Spring Hill Brisbane, Que Apartments South Brisbane, Soho Apartments South Brisbane, Unimproved Capital Valuation Brisbane
Posted in property taxes and rates etc | 1 Comment »
Posted by Rob Honeycombe on 12 December 2007
Many buyers go in search of the “worst home, best street” believing the value of those around them will pull their own home’s price up. A relatively new problem is the apartment owner who renovates but finds their fellow body corporate members reluctant to shell out for any external works. Around Brisbane’s inner suburbs this is a common problem: a 1970’s or 80’s vintage home unit gutted by a keen new owner and given a new lease of life, only to have its value and appeal limited by the very original lobbies, gardens and common areas. In St Lucia there’s a recent, typical example: built in 1979 the bedrooms and living areas of this building’s apartments are spacious, and it’s an elevated and central location. Great renovator ingredients. But buyer expectations of that era have been long surpassed, so walking through a basement to get to apartments is not real popular today, and there’s no security or gated entry of any sort.
No doubt all owners are happy to have ‘pocketed’ recent capital gains. Where the average apartment is now selling for close to $400,000 it was less than $200,000 only 5 years ago. But when asked to contribute to upgrading that included a security entry and opening up dingy stairwells, most owners had surprisingly short arms for their deep pockets. Real life’s not like “The Block” – for a start you don’t have Channel 9 footing the bill. And even if owners understand the need to spend it’s like all good body corporate issues where no-one wants the job. Committee members are volunteers and the paid managers don’t like the extra work. Where’s Jamie Durie when you need him!?
A body corporate can actually borrow money to fund renovations and by doing this, or extending the works program over a period of years, the real cost to each owner can be made as comfortable as necessary. Consensus amongst owners is the problem. If you’re an investor you’re “in the market” every time the apartment is vacant and you compete with newer buildings. Owner-residents might not think it’s a concern where you have no plans to move. But as the quality of tenants attracted to the building slowly declines it might start to affect your lifestyle.
One owner in that St Lucia building recently voted against common property upgrades, then complained at the AGM that he was looking to sell up, annoyed by the ‘party animal’ tenants taking over the building! And the bad news? We expect this problem to get worse as more and more buyers opt for an older apartment in the inner city ahead of a brain-numbing commute to an outer suburbs house for the same price. Maybe it’s time more owners got actively involved in their body corporate…
Tell us what you think: do older buildings limit a renovator’s opportunity? Should upgrading be mandatory? Share your thoughts!
Tags: body corporate issues Queensland, St Lucia Brisbane
Posted in architecture and renovation, trends in Brisbane property | 1 Comment »
Posted by Rob Honeycombe on 29 August 2007
As apartment projects get bigger it’s become more common for a resident manager to be appointed and, for better or worse, this person becomes the human face of the building. There are a number of exceptionally good operators, some in larger buildings where they take a professional team approach, and often in smaller schemes where those with great people skills really shine. But across the board we hear a lot of comment from apartment owners that their resident managers are grumpy, cost a fortune and aren’t up to the job. So it mightn’t be any surprise developers are thinking twice and, in some cases, it seems new developments in Brisbane’s inner city will no longer have an onsite manager.
Usually sold their management rights by the developer, resident managers are paid an annual income to clean and maintain all of the common property, and are granted the exclusive right to operate a letting business from the lobby or other common area. (Many promote the myth that they’re the only agents able to manage rentals in the building, but unless the apartment is part of a lease-back or other managed investment this is simply not true.) Most pay a handsome sum for these rights and receive a 25 year term contract that makes them very hard to sack. Caretaking fees are usually around $1000 per apartment per year, so when the walkways are muddy and the pool’s not cleaned residents are quick to find fault. And we think rightly so.
Some resident managers seem to believe they’re de facto presidents of tiny sovereign states, plastering lobby noticeboards with random rules, obstructing tenants who rent through other agents and treating owners as second rate citizens. In a most extreme case a Spring Hill manager recently told an investor he’d leave her apartment vacant for two months if she appointed another agency. This same person, paid a salary by the body corporate of hundreds of thousands of dollars, abused another owner’s agent at the top of his voice in the building’s lobby, telling them if they came back he’d “rip your f..ing head off”.
Apartment owners pay onsite managers’ wages out of their own pockets and, regardless of how much that manager might have paid a developer, are entitled to expect excellent service. In the USA they’re known as the superintendent or ’super’, and at the high end buildings across the world employ a concierge and even doormen. And of course it comes at a cost.
The Australian model seems sound while resident managers deliver the goods. But with body corporate fees under pressure from rising costs, owners of apartments (and especially buyers of new ones), will reconsider their options if there’s no assurance of good service.
Tags: body corporate issues Queensland, resident apartment managers, Spring Hill Brisbane, USA
Posted in Spring Hill, trends in Brisbane property | No Comments »
Posted by Rob Honeycombe on 18 July 2007
Last year’s Census highlighted the growing appeal of apartments in Brisbane’s inner city suburbs. Some 69% of our housing is now attached, but despite this there’s still plenty of confusion over how apartment buildings operate and who the body corporate actually is. As inner city agents we’ve made it our business to know – so here’s a quick overview:
A body corporate simply consists of each owner of a lot (eg. townhouse, duplex, apartment, villa or unit) in a community titles scheme. When you buy you automatically become a member of that body corporate, which is a separate legal entity and a bit like a company with you as its shareholders. In Queensland there’s an Act that regulates exactly how this works and it’s overseen by the Office of Fair Trading. The annual meeting of owners (the 3 of them that turn up plus the gardener’s dog!) elect a committee of owners to oversee regular decision making, and usually also appoint a manager to do all the admin work. A body corp is generally responsible for maintenance of all of its common property and that’s usually everything outside the 4 walls of each apartment including walkways, lifts, pools, stairs and infrastructure such as pipes and wiring.
Of course the committee can’t make major decisions or incur big dollar expenses without a general meeting of owners. If you’d like to have more say in your building put your hand up for the committee, but be aware it doesn’t pay and can be a thankless job. Interestingly there can be a marked difference in the ongoing appeal between similar buildings simply due to one having an active committee, and another being left to an external manager.
So there’s no outside company or person deciding the fate of your building. The annual costs are set by the owners – hopefully with recommendations by the managers as experts in this – but the idea that someone is hiking costs for their own benefit is just not true. Put a bunch of people in the one building, add some emotional issues like money, keeping of pets, noisy parties and bikes stored on balconies and it’s no surprise there’s ingredients for disagreement! But the real surprise is how well most bodies corporate actually operate. Remember that a dominant committee or chairperson can make life interesting but at all times all owners collectively have the final say.
Tags: body corporate issues Queensland
Posted in trends in Brisbane property | No Comments »
Posted by Rob Honeycombe on 21 June 2007
With more domestic animals in Queensland than humans it was only a matter of time til we heard the patter of little paws throughout the inner city. While landlords may not be as open to the idea, owner-residents are bringing their 4-leggers with them in big numbers. Across Australia almost two-thirds of households have a pet – there’s 819,000 dogs and 443,000 cats in this state alone!
So rather than designing near city apartments, townhouses and small lot homes to be child-friendly, architects need to be thinking about the moggies and rat-sized dogs that provide company (and security) for so many Brisbanites. In many countries of course pets have co-habitated with us for many years in medium and high density. Experts say a view of the outside world, places for play and noise separation from neighbours are some of the big issues.
Inner city living appeals to households pre-kids, no-kids and post-kids and naturally these groups are often the same ones to enjoy a pet’s company. So it’s simple logic that if you go to sell you’ll take longer and may get a lower price if pets aren’t allowed in your building and a huge part of your market is ruled out. Landlords know that allowing a pet often produces a premium rent, and managed well, the impact on the property should be minimal if any.
Despite what you’ve heard most apartment buildings can accept pets. The standard Queensland by-laws give the committee rights to approve an animal, and it’s rare for the developer to have changed these in the set-up. Usually it’s the committee that haven’t had help dealing with the issue so, worried about potential for complaints (and in an unpaid and thankless job) they naturally duck for cover when the question’s raised. We recently sold a penthouse apartment where the owners’ main reason for moving was to buy a dog. One major development recently promoted its pet-friendliness as a key selling feature in a big ad campaign.
Of course there’s also a market for those who aren’t happy to share the lift with a sniffy-nosed mutt and some buyers are seeking out apartments where pets are banned. But with so much interest, and money, in the issue we do expect plenty more inner city buildings to bite the bullet and adopt some sensible rules for living in harmony with our furry, feathered and finned companions.
Tags: body corporate issues Queensland, Brisbane home design, pets, renting to pets Brisbane
Posted in Brisbane's rental market, Brisbane's sales market, trends in Brisbane property | 1 Comment »
Posted by Rob Honeycombe on 4 April 2007
A new and interesting trend to watch is apartment amalgamations, where two or more inner city apartments are combined into one, with walls and occasionally floors opened up to create “super apartments”. Often the completed apartments are larger than free-standing homes, the idea is now breathing life into some older buildings in Sydney , and we’d expect Brisbane to follow suit. Many inner city apartments were designed predominantly for the rental market, but with surging demand from empty-nesters and other owner-occupiers there’s a growing case for taking smaller apartments in prime locations, bringing in a clever architect and a patient builder, and creating a home that’s just as you’d like it.
A well-known southern example – Aussie Home Loans boss John Symonds created a 520m 2 penthouse at Walsh Bay by consolidating two 3 bedroom apartments into one. That apartment sold last year for a NSW apartment record of $16.5 million. The simplest way to find a super apartment of course is to buy off-the-plan and convince the developer to redesign. The top floor of Brisbane ’s Riparian Plaza was a recent example, with the owners now occupying more than 1000m 2 (that’s almost a quarter of an acre!) South Bank’s “Saville” building is home to a consolidated apartment, and there are reportedly early double-sales in the new “Skyline” and “Vision” towers in the city, where buyers had new designs produced to ensure their very individual slice of property heaven.
Given the limited riverfront land in our CBD we’d expect to see consolidations happen here over the next couple of years. There will be few new apartments built and many 1 bedroom and smaller two bedroom apartments are now “under-capitalised” for their location. So how will the neighbours feel? In Sydney the Darlinghurst “Horizon” building has drawn up guidelines for amalgamations as it’s happening so often. There’s been a positive response as occupant numbers generally fall, and owners with more money invested in the tower are taking a greater interest in its affairs.
Might be time to start talking to that neighbour again!
Tags: body corporate issues Queensland, Brisbane apartments, Brisbane home design, Riparian Plaza Brisbane, Saville apartments South Bank Brisbane, Skyline apartments Brisbane, Vision Tower Brisbane
Posted in Brisbane CBD, Brisbane's sales market, architecture and renovation, trends in Brisbane property | 1 Comment »
