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Understanding Body Corporate Disclosure Statements
In Queensland, the law mandates that sellers of lots in community title schemes provide a disclosure statement to prospective buyers before entering into a contract.
Each body corporate has a budget for each fund type for each financial year. The body corporate manager assists the committee to prepare the budget for each year. Budgeting for the administrative and sinking funds are quite different, as the reason for each fund is different.
Item | Budget | Calculation |
---|---|---|
Insurance | $35,000 | Look at the last insurance renewal cost, and the number of months that has elapsed since renewal. Apply a percentage increase to anticipate the insurer’s price increase based on industry trend data. Take into account any change to the building’s replacement cost estimate, improvements made to the common property, or an updated insurance valuation. |
Building manager | $67,250 | Look at the fixed-term agreement for the building manager/caretaker Look at the agreement price indexation date and amount, calculate or anticipate either CPI increase of fixed percentage increase Apply increase considering duration of old and new pricing within the budget period |
Carpark cleaning | $4,000 | 1x major annual wet & dry vacuum – $2,000 2x minor dry vacuum only $1,000 per visit |
Legal fees | $2,500 | Anticipate legal advice for 1x dispute with owner regarding by-laws 20% provision for unforeseen costs |
Lift registration | $1,900 | Prior year statutory registration fee + anticipated CPI |
Fire equipment | $5,250 | Fixed-price service plan for lights, doors, extinguishers $3,000 additional allowance for major 5-year maintenance service of pumps based on quote |
The onsite facilities generally are a key feature of the lifestyle and value of your body corporate, but they also impact the cost of levies. Facilities like pools, gym, sauna, spa, lifts and other recreational amenities generally attract:
The onsite facilities generally are a key feature of the lifestyle and value of your body corporate, but they also impact the cost of levies. Facilities like pools, gym, sauna, spa, lifts and other recreational amenities generally attract:
The structure of the scheme also plays a role in the cost of the levies. A high-rise building with 200 apartments will have very different building features, services and costs to a 200-townhouse development in a gated community.
Generally, maintenance costs increase with the age of a building. Even buildings kept in good condition by their body corporate typically face increasing maintenance costs as elements of the building reach their end of life.
In Queensland, the law mandates that sellers of lots in community title schemes provide a disclosure statement to prospective buyers before entering into a contract.
Understanding how your individual levy amount is calculated can help you appreciate where your money goes and ensure transparency in the management of your community. Here’s a breakdown of the aspects involved in calculating levy amounts.