Most Common Owners Corporation Mistakes When Self-Managed

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Most Common Owners Corporation Mistakes When Self-Managed

owners-corporation-managers

Some owner’s corporations choose to manage themselves. When this happens, a few individuals volunteer to take on the tasks that a Body Corporate Manager would have done. These volunteers may be very motivated and well meaning but more often than not, things go wrong. When building matters are left to a person that may have a stake in any outcomes, this may cause a conflict of interest. In the worst case scenario, the building may suffer from not being adequately protected against potential risks.

Below are some self-management pitfalls to watch out for.

⦁ Not paying fees on time:

Every strata title will accrue fees that need to be paid on time. When a body corporate is self-managed, these can go unpaid and important maintenance or repairs does not take place. This makes the building become rundown and the building can fall into disarray. Renting apartments becomes harder and the resale value of the property can also decrease. At Montano Strata Management, all our managers are meticulous with record keeping and will ensure that all fees are paid on time.

⦁ Failure to deal with neighbour disputes:

Self-managed owners’ corporations may not always know all the statutory requirements that need to be met when decisions are being made. Unilateral decisions can be made in such cases which lead to some members being disadvantaged. As a result, arguments and disputes will come up and these can be hard to mediate if only invested parties are involved. When you work with a Montano Strata manager, all disputes will be dealt with professionally and efficiently.

⦁ Keeping body corporate fees low:

In the short term, this may seem like a good thing as everyone gets to save money but it can have long-term repercussions on your investment. Without proper planning, the administration and capital works fund may not have sufficient capital to cover the costs of the scheme. It is incredibly important that funding is in place to cover the monthly costs of the scheme but also to undertake repairs when necessary. A detailed budget in place will ensure the building will not degrade, and owners can continue to experience capital growth and rental returns for their investment. Keeping the body corporate fees low for the sake of having low fees is not the best long term outcome in maintain the current condition of the property.

⦁ Poor succession planning:

Should the current owner currently managing the strata title decides to sell or can no longer give their time, another owner to take on the role will need to be found. A replacement can be hard to find and even harder to train to take up the job. As such, the efficient running of the strata scheme can quickly be undone. In such a case, call Montano Strata Management and we will provide the solution to efficiently manage your strata scheme.

Do you have any questions regarding residential and commercial strata management? Are you looking to switch strata managers? Not altogether satisfied with the information you’ve been getting from your current strata managers? Don’t hesitate to contact Montano Strata’s qualified team today.

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    Montano Strata Management is a family business that cares, we believe in promoting a strong and mutually respectful relationship.

    6 Reasons To Appoint A Good Body Corporate Manager

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    6 Reasons To Appoint A Good Body Corporate Manager

    body-corporate-managers

    Many owners in body corporate schemes question if it is necessary to get an outsider to look after the complex on their behalf. From an outsider’s view it may seem like the work that an owner’s corporation manager does can be done by anybody else but this could not be further from the truth. Today we will take a look at why it is a good idea to get a professional on the job. Below are the top 6 reasons why it is better to appoint a manager to take care of your strata title.

    1. A strata manager ensures compliance with statutory requirements:

    There are a lot of legislative requirements that must be met by strata schemes. A good strata manager is aware of any amendments or changes to these statutory requirements which can affect your strata scheme and ensures that you are always in compliance.

    2. A strata manager carries out day to day tasks

    Every Body Corporate has day to day tasks that need to be carried out. A good strata manager will coordinate any repairs required, attend and provide minutes for all meetings. A strata manager is responsible for paying invoices as well as all the financials for the strata scheme. The manager also issues and collects levies and attends to any correspondence.

    3. A strata manager is responsible for the record keeping:

    Body corporate records must be kept in line with legislative requirements. A strata manager is responsible for making sure that this is adhered to. The strata manager also ensures that any and all records are always readily available to lot owners and any other interested parties.

    4. A strata manager manages the bank accounts:

    Finances can be tricky and if left to just anyone can result in unnecessary losses. A good strata manager prepares the financial statements when they are needed. This can be for tax audits, BAS lodgements or for tax returns. The manager takes care of the term deposits and deals with levy recovery.

    5. A strata manager handles all insurance issues:

    It is important that each Body Corporate has insurance that covers their scheme. A strata manager obtains quotations, helps in picking the right insurance for the title, deals with insurance claims and obtains policy renewal quotations.

    6. A strata manager can be objective on all matters:

    Sometimes issues can arise in the Body Corporate. With everyone having a stake in the outcome of any dealings that the strata undertakes, it is prudent to have a neutral party that can be objective in such cases.

    Do you have any questions regarding residential and commercial strata management? Are you looking to switch strata managers? Not altogether satisfied with the information you’ve been getting from your current strata managers? Don’t hesitate to contact Montano Strata Management’s qualified team today.

      Looking to Change, Its Easy!
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      Montano Strata Management is a family business that cares, we believe in promoting a strong and mutually respectful relationship.

      Why Strata Inspection Reports Matter When Buying into a Strata Scheme

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      Why Strata Inspection Reports Matter When Buying into a Strata Scheme

      Strata-Inspection

      How can you know if the strata scheme that you plan to buy into is financially viable? This can be done by making sure that a strata report is done on your behalf. Today we will take a look at some top reasons why strata inspection reports matter when buying a property. We will also cover other key aspects such as what is done when a strata report is being compiled as well as what the process of a building inspection in a strata scheme entails. 

      ⦁ What is a strata inspection?

      A strata inspection report (also known as a strata search is a report all purchasers of a strata title, community title or company title property should invest in whether this is a residential or commercial property. This is usually done before the sale of a building or property. For people that want to buy into a strata scheme, it is vital that they get a strata inspection done so that they find out if the investment will be worth their while or not. At Montano Strata Management, we have many years of experience in the strata management industry. We can help you with your strata inspection when you need one performed.

      ⦁ What is contained in a do strata inspection report?

      A strata inspection report is similar to a building report when buying a house. The records of the Owners Corporation must comply with the Strata Schemes Management Act. A strata inspection report will include the following major items such as current owner details, quarterly levies for the property, compliance obligations such as fire inspections, by-laws, proposed major expenditure and minutes of meetings.

      ⦁ Why are strata reports necessary?

      Strata inspection reports are very important when you are considering purchasing into a strata scheme. Strata properties differ from freehold properties in that they are subject to many rules and regulations which you will need to abide by if you decide to go through with the purchase. A strata report enables you to understand whether you are buying into a well run and maintained property.
      Conversely, it can also make you aware of any pitfalls that you may potentially get into by proceeding with the purchase. These can be in the form of exorbitant fees, legal issues, residential disputes and any financial mismanagement that takes place in that strata scheme. By so doing, you are protected as a potential buyer and you can make an informed decision.

      Do you have any questions regarding residential and commercial strata management? Are you looking to switch strata managers? Not altogether satisfied with the information you’ve been getting from your current strata managers? Don’t hesitate to contact Montano Strata’s qualified team today.

        Looking to Change, Its Easy!
        Request a Quote Today

        Montano Strata Management is a family business that cares, we believe in promoting a strong and mutually respectful relationship.

        Strata Insurance Tips For Property Owners

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        Strata Insurance Tips For Property Owners

        strata insurance

        For new owners of strata titles, strata insurance can be confusing. It is easy to assume that the body corporate has you covered in that regard but that is not always the case. You need to know the extent of your coverage and what is not covered. This will protect you against potentially costly damage. Montano Strata Management is a strata management company with a difference, we can help you deal with virtually any strata issue that you may have.

        To find out more about strata insurance, read on!

        ⦁ Who pays for strata title insurance?

        Strata insurance is a legal requirement under the Strata Scheme Act. Each owner of the strata scheme contributes to the payment of the strata title insurance. This is done by paying quarterly levies to the body corporate. These pooled funds are then made available for the payment of the strata’s insurance. Even though the strata insurance is paid for by all the owners of the strata, their individual contributions may differ depending on the value of their property in the strata.

        ⦁ What does strata insurance cover?

        Strata insurance covers shared or common property in a strata-managed complex, owners’ corporation or body corporate-managed complex. Generally this covers external areas such as balconies, common-area gardens and barbeques, pools and tennis courts, intercoms and garages. In case there is any damage to the property or if things are destroyed in a fire, floods or burst pipes, the strata must be covered for its full value. The body corporate can decide to extend the insurance from the basic coverage so that it covers third party liability and the cost of alternative accommodation in case any unit becomes unhabitable.

        ⦁ What does strata insurance NOT cover?

        While strata insurance covers shared and common property, it is important that you know that there are parts of your residence that you will need to cover yourself. This is where owners need to ensure they have their own insurance cover for the contents within the property. Generally speaking, items that aren’t covered by strata insurance include internal fittings and fixtures, lights, carpets, floorboards, furniture, electrical items, jewellery and other personal belongings.

        ⦁ Other Insurance Cover

        Investors in strata schemes may also want to take out landlord insurance. Landlord insurance is a policy that covers you against events such as loss of rent due to a tenant’s rent default, the theft or burglary of any belongings you have leased to your tenants, and natural disasters such as storms.

        Do you have any questions regarding residential and commercial strata management? Are you looking to switch strata managers? Not altogether satisfied with the information you’ve been getting from your current strata managers? Don’t hesitate to contact Montano Strata’s qualified team today.

          Looking to Change, Its Easy!
          Request a Quote Today

          Montano Strata Management is a family business that cares, we believe in promoting a strong and mutually respectful relationship.

          All You Need To Know About Strata Insurance

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          All You Need To Know About Strata Insurance

          Strata-Insurance

          Building insurance, strata insurance and contents insurance, are they the same thing and do you need just one or all three? This is a question that many strata owners have, and we are here to give answers to just that. Strata insurance is not just a convenience, it is a must have for all body corporates. What is covered by the strata insurance and what isn’t depends on the type of policy that is taken by the body corporate. To find out more about strata insurance, read on…

          1. Building insurance, contents, and strata insurance, what are they?

          Building insurance is specifically for permanent structures. It is usually used by clients that have freestanding homes or any other home structure like a granny flat or a detached garage. For strata owners, this is usually unnecessary as strata insurance usually covers everything that building insurance could have covered. Contents insurance is used to cover the movable things inside your home. Furniture, art, and electronics, for example. For people that live in a strata property, this is necessary as it covers your personal contents not covered by strata insurance.

          Strata insurance is a broad spectrum policy. It usually covers the following: impact damage, storm damage, malicious damage, water damage, accidental damage, and fire damage. It is important to note the exclusions that are stated in the policy which you decide to choose for your strata. Building defects are one such thing that is usually not included in strata insurance but a lot of owners try to claim for and they get denied.

          2. How much will it cost and who can claim?

          Premiums for strata insurance vary depending on a couple of factors. If your strata building is located in a place that is prone to natural disasters such as bush fires or flooding, this will increase premiums. The age and state of the building also factors into the cost of the monthly premium particularly where regular repairs and maintenance has not been done over the years. The additional features of a property such as swimming pools, tennis courts etc will increase the price of the premium.

          When you want to lodge a claim, you need to speak to your strata manager. They know your policy back to front and will be able to advise you on the next steps. Some issues are better dealt with by the owners’ corporation instead of claiming insurance on them. In such a case, the strata manager can start the correspondence with the owner’s corporation on your behalf. If such a claim is denied by the owners’ corporation, you may have to go directly to the insurer and claim yourself.

          Do you have any questions regarding residential and commercial strata management? Are you looking to switch strata managers? Not altogether satisfied with the information you’ve been getting from your current strata managers? Don’t hesitate to contact Montano Strata Management’s qualified team today.

            Looking to Change, Its Easy!
            Request a Quote Today

            Montano Strata Management is a family business that cares, we believe in promoting a strong and mutually respectful relationship.

            Common Strata Issues And How To Deal With Them

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            Common Strata Issues And How To Deal With Them

            strata-community

            Community living has many perks but there can be are downsides as well. This is because from time to time, issues can come up between different residents of a strata community. At Montano Strata we are invested in seeing every strata scheme thrive. To help you, we have compiled a list of 4 common issues that come up most often and how you can deal with them.

            1. Noisy neighbours:

            Noise is a common strata problem. Each resident has the right to enjoy their own space in a manner that they see fit without infringing on the right of their neighbours to do the same. If a new tenant moves in, ensure that they have a copy of the by laws and that they know exactly what is expected of them concerning noise.

            2. Smoke drift:

            Smoking can cause problems between neighbours. If someone smokes on their balcony, the smoke may drift into their neighbours’ apartments. Passive smoking is very bad for health and no one should be subjected to it. If you are a smoker, make sure that your windows and doors are closed when you smoke so that the smoke drift does not escape into common areas or other people’s homes.

            3. Parking problems:

            Parking is another strata problem that almost always comes up. Residents often park in spots that aren’t assigned to them or they cause obstructions in the way that they park. To avoid this, resident’s must know that they are strictly expected to only park in their designated spot.

            4. Owning Pets:

            The strata scheme by-laws govern whether a resident can have pets or not. The model by-laws either do not allow pets or allow pets subject to the owner’s corporation approval. Ensure you obtain a copy of the by-laws to understand which by-law regulates your strata scheme and if pets are allowed obtain the necessary approval. Make sure that you follow all the by-laws concerning pets and ensure that your pets are always monitored when on common property.

            Do you have any questions regarding residential and commercial strata management? Are you looking to switch strata managers? Not altogether satisfied with the information you’ve been getting from your current strata managers? Don’t hesitate to contact Montano Strata’s qualified team today.

              Looking to Change, Its Easy!
              Request a Quote Today

              Montano Strata Management is a family business that cares, we believe in promoting a strong and mutually respectful relationship.

              How To Select The Right Strata Management Agency

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              How To Select The Right Strata Management Agency

              strata-management-agency

              Deciding which agency to hire to be your strata manager is often a difficult task. You want to find a strata management company that can professionally and promptly deal with any issues that come up. You also want to ensure they are competitively priced. To help you with this difficult decision, we have compiled a handy guide. Whether you are looking to change strata manager or looking for strata manager for a new building, keep these suggestions in mind to help you.

              1. Pricing:

              As with many other things in life, with strata management, you usually get what you pay for. If you get a quote from a strata management company and it sounds too good to be true, then it most probably is. Be that as it may, you must also ensure you receive value for the money. When deciding which strata manager to go with ensure you consider both these factors.

              2. Financial Reporting:

              It is important to see how transparent a strata manager is with disclosing the financial performance of the strata scheme. How often are they going to send the financial reports to all owners? How much detail are they willing to explain where the funds are being spent? When deciding which strata manager to go with ensure you understand the frequency and detail of information to be received.

              3. Agency’s Location:

              It is very important that you choose a strata management agency that is located close to where you have your property. A company that shares the same locale will have in-depth knowledge of the unique challenges and risks that owners face in your area and how best they can maintain your property. There will be times when your strata manger will need to attend the property to discuss complex issues.

              4. Recommendations:

              When you are looking for a strata management agency, it is good to consider what those close to you recommend. Fellow building owners in the same area may also be useful in providing links to a great strata management service. Recommendations from trusted sources can prove to be very helpful.

              5. Your Expectations:

              Before you start looking, you must clearly know what your expectations are. If you have any other requirements other than the common aspects of strata management, these must be clearly communicated with any potential managers. Whoever you choose must be aware of all that you will require and you be comfortable that they can meet these requirements.

              6. Past Experience:

              Finally, when you are choosing a strata manager, you must look at their qualifications and your fellow consumer’s experience. Going online and reading the reviews that may have been posted is a good source to understand how well regarded the strata management agency is.

              Do you have any questions regarding residential and commercial strata management? Are you looking to switch strata managers? Not altogether satisfied with the information you’ve been getting from your current strata managers? Don’t hesitate to contact Montano Strata’s qualified team today.

                Looking to Change, Its Easy!
                Request a Quote Today

                Montano Strata Management is a family business that cares, we believe in promoting a strong and mutually respectful relationship.

                Improving The Value Of Your Strata Property

                Strata Property

                Improving The Value Of Your Strata Property

                Strata Property

                Nothing stays new forever and buildings are no different. A strata property will deteriorate with time unless specific measures are put in place. If these are not followed through, it can lead to the property’s value not appreciating at the same rate of other properties in the area. This can be done by owners corporation by undertaking regular maintenance and keeping the property in a good state of repair. Below are our top tips on how you can improve the value of your strata property.

                ⦁ Regular Maintenance and repairs:

                The Strata Schemes Management Act states that you are required to keep the strata property in a state of good and serviceable repair. It is therefore paramount that you use professional and licenced tradespeople to maintain the common areas on your behalf.
                If you have external body corporate management, it is their job to ensure that common areas are always kept presentable. These include, hallways, garbage rooms, gardens, parking lots, the vestibule, laundry rooms and gymnasiums.

                ⦁ Frequent repairs and updates

                The Strata Schemes Management Act clearly states that any defects that require repair must be dealt with quickly. The strata management must hire expert repair personnel to deal with the issue. The costs must be covered by the strata community via their levies. A strata scheme should also comply with relevant legislation. An example is the Swimming Pools Act which states that all pools require a child-proof safety barrier or regular service of the lift to ensure the annual safety compliance certificate is issued.

                Regular updates are important as they ensure that the property is kept up to date with current technological developments. Measures that can be taken include installing Wi-Fi enabled intercom, elevator upgrade, repainting the walls or garden makeovers.

                ⦁ Reducing running costs

                This is a great way to make sure that you save enough to be able to perform regular maintenance and frequent repairs. You can do this by changing to low emission lighting and installing movement sensors so that you spend less on electricity. Water saving measures can be implemented so that all the money that is saved by the body corporate can be used to improve the building.Do you have any questions regarding residential and commercial strata management? Are you looking to switch strata managers? Not altogether satisfied with the information you’ve been getting from your current strata managers? Don’t hesitate to contact Montano Strata’s qualified team today.

                  Looking to Change, Its Easy!
                  Request a Quote Today

                  Montano Strata Management is a family business that cares, we believe in promoting a strong and mutually respectful relationship.

                  Key Aspects of Strata Management Laws

                  Strata Management Laws

                  Key Aspects of Strata Management Laws

                  Strata Management Laws

                  Strata title management can be complex to understand and it takes time to understand who to successfully manage a strata scheme. Not all investors and homeowners understand what a strata scheme is and what is expected of them when they are part of one. Owners in a strata scheme should be aware of their responsibilities when they buy into a strata complex and to know what laws they are expected to abide by. Below is a list of the top 5 things you need to know about strata management laws.

                  1. Stata by-laws:

                  Strata schemes are regulated by a set of rules that all residents are expected to abide by. These cover issues such as safety, security, pets, general behaviour, parking, altering of common property and rubbish disposal. If an owner rents out their property, they are expected to give their tenants a copy of the latest by-laws.

                  2.Section 184:

                  If you are thinking of buying into a strata complex, you must request a Section 184 certificate before signing any final documents. This will provide you with vital information about the strata scheme such as the levies payable, special by-laws and outstanding levies. You can apply to the body corporate for a copy of the certificate through your lawyer.

                  3. Strata levies:

                  Body corporates are funded by quarterly levies that are paid by owners. The levies are usually split between the administration fund and capital works fund. The administration fund is used to cover costs such as water rates, insurance, fire safety, power charges for communal areas, maintenance and repair of common areas.

                  4. Strata renovations:

                  You are not allowed to renovate or alter common areas without getting approvals from the body corporate. The strata legislation makes a distinction between minor and major renovations. Minor renovations can be approved by the strata committee and major renovations require a general meeting and the registering of a by-law.

                  5. Strata agents:

                  The duties of a body corporate are getting increasingly complex. Many are opting to engage an agent that can manage the scheme on their behalf. For this to happen, there must be a majority vote at a general meeting. External body corporate management makes sure that the strata scheme is running efficiently and professionally and that all laws are being adhered to.

                   Do you have any questions regarding residential and commercial strata management? Are you looking to switch strata managers? Not altogether satisfied with the information you’ve been getting from your current strata managers? Don’t hesitate to contact Montano Strata’s qualified team today.

                    Looking to Change, Its Easy!
                    Request a Quote Today

                    Montano Strata Management is a family business that cares, we believe in promoting a strong and mutually respectful relationship.

                    What Sort of Things Can We As Owners Corporation Managers Charge For?

                    Owners Corporation Manager

                    Q&A: What Sort of Things Can We As Owners Corporation Managers Charge For?

                    Owners Corporation Manager

                    We looked for answers for some of the most frequently asked questions that Owners Corporations Managers ask.

                    Question: Can we charge for two Owners Corporation (OC) certificates per sale-one at the beginning and one prior to settlement?

                    Answer: Yes, you can. This is a common procedure that occurs when a person purchases into an owner’s corporation. Many strata companies are frustrated because they pay for the first OC certificate and have to pay again for an updated one. The two, however are not the same under the law and must be treated as such. The initial OC certificate is a requirement of the paperwork that must be included in the Sale of Contract, it also ensures that the purchaser has done some due diligence.

                    A conveyancer must factor this into the overall cost of purchasing the property. If there are any changes to the document during the settlement period, you may need to request for an updated OC certificate which is charged for separately. The charging process differs with each company but under Section 151 of the Owners Corporation Act, a person may request for an OC Certificate for a fee. This fee may be charged per certificate issued.

                    Question: What fees and charges can an Owners Corporation Manager lawfully charge for?

                    Answer: Before appointing a new Owners Corporation Manager, each Owners Corporation signs a Contract of Appointment with that managing agent. Inside that contract, a list of charges and fees must included. Specific charges for ballots and preparation of records for termination should also be listed down. To make sure that the contract is valid, it must be dated and signed by all parties. It must also be stamped with the common seal.

                    The Strata Community Australia VIC (SCAV) has a list of recommended charges that you may choose to include in the contract. This will help you determine whether or not you are being charged reasonably and fairly.

                    Question: Our developer signed a three-year Contract of Appointment with our current Strata Management Company, but we are not happy with their charges. What can we do?

                    Answer: The developer is the original owner under the law. He is able to sign a three-year term contract with a Owners Corporation management company. When you take over the ownership, this contract is still valid until the stipulated time. If you are not happy with the services you are being provided with, you can discuss this with the management company. If you cannot resolve the issues at hand, you can start the process of terminating the contract and looking for new management.

                    Do you have any questions regarding residential and commercial strata management? Are you looking to switch strata managers? Not altogether satisfied with the information you’ve been getting from your current strata managers? Don’t hesitate to contact Montano Strata’s qualified team today.

                      Looking to Change, Its Easy!
                      Request a Quote Today

                      Montano Strata Management is a family business that cares, we believe in promoting a strong and mutually respectful relationship.