Investing in a quality, well-located strata apartment or townhouse is one of the best ways to create wealth. However, long-term investment success also depends on understanding your strata responsibilities as a landlord.
If you own an investment property, you should be aware the owner’s corporation must have one annual general meeting (AGM). This meeting deals with matters that the owners must consider, including insurance and building defects.
A chairperson is appointed to run the AGM. The chairperson can be the strata manager or is elected by the owners, along with the secretary. The secretary organises the AGM, and you must lodge your proxy vote with this representative if you are unable to attend the meeting.
The ability to vote by proxy is advantageous if you are otherwise engaged on the night of an AGM or live too far away. However, if you can attend the AGM, do your best to participate in the meeting. Not only can you play a role in the management of the communal aspects of the strata building, but the AGM provides you with an opportunity to meet and greet fellow owners. These contacts can prove useful, especially if some of the owners live in the building.
By being at the annual meetings, you can also make sure the secretary and the chairperson are the right choices, as well an opportunity to interact with the strata manager. Meeting the strata manager face-to-face can be valuable should issues arise with the property down the track.
The AGM is also an opportunity to have your say about how the money in the strata’s sinking fund is spent. If you feel an expense can be postponed, as an owner, the AGM allows you to voice your view. The annual meeting also will enable you to ensure the strata manager follows usual processes such as getting several quotes for a maintenance job.
As an owner, you should be aware that each strata scheme has by-laws. The by-laws are a set of rules that owners, tenants and, sometimes, visitors must follow. If it’s a non-smoking building, for example, your guests must follow this regulation. It is also the responsibility of the landlord that the strata by-laws are made available to your tenants.
As a landlord, it’s essential that any renovations require strata approval first – such as the installation of new wooden floorboards. It would help if you also double-checked there are no gaps between your landlord cover and the strata insurance paid for by the owners corporation.
For more information on your strata obligations as a property investor, contact your local Raine & Horne property manager, or your strata manager.