If you think you’ve found the perfect apartment investment, then read this first. Sometimes behind the scenes shenanigans can scupper your investment dreams.
In short, if your building isn’t properly managed, then the value of your investment can be quickly eroded. So what can you do to avoid this catastrophe?
Fist up, it goes without saying that any investor worth their salt will obtain a strata report before buying. This will note:
the performance of the owners corporation;
the condition of the building;
any major upcoming expenses (such as lift or cooling tower repairs);
and the ability of the building’s sinking fund reserves to cover such repairs or replacements.
As Daniel Brown, senior building manager with Waterpoint Asset Management (WAM), explains, a well-maintained and professionally managed property will present itself favourably to valuers and buyers when compared poorer managed buildings – and stands the best chance of appreciating in value. Ultimately, the test of whether a building is well managed or not is reflected in the resale prices of individual apartments, he says.
According to WAM, long gone are the days of unqualified ‘caretaker-cleaners’ living on the premises and doing odd jobs: As strata legislation became more complicated and environmental demands increased, so did the need for expert guidance on occupational health and safety regulations, security, financial, accounting, insurance and legal issues. Consequently professional building managers are now the norm.
“It is not uncommon for the total asset of a large strata development to be worth hundreds of millions of dollars, and it’s our job to ensure everything operates efficiently and looks its best at all times,” said Brown. “A professionally managed building contributes greatly towards a harmonious community and the asset value of the property.”
Do you agree with Brown? What are your views on building managers? Have your say by commenting below, or joining the debate on our online property investment forum.
How to boost your property investment tax refund
Danger: how to avoid scuppering your chances of getting a mortgage
With interest rates at their lowest for more than 50 years, there are some great rates available. The best thing to do is to compare rates from all the lenders. Let us help take the leg work out of doing this - Compare Home Loans now
Top Suburbs :
Get help financing your investment
Do you need help finding the right loan for your investment?
When investing in property, it is important to make sure that you not only have the lowest available rate that you can get, but also have the correct loan features for your needs.
Just fill in a few details below and we'll then arrange for a local expert Aussie Mortgage Broker to contact you and work out what features or types of loans are right for your needs. We'll even help with the paperwork. Plus, our mortgage broking service is at no cost to you.
We value your privacy and treat all your information seriously - you can check out