For many an investor, purchasing a property within a strata managed development, whether it be residential, commercial or industrial in Macquarie Fields or any Sydney suburb, is a boon.
In this article we would like to highlight the advantages as we and our clients see them to help you understand the process and determine if this style of investment will suit your portfolio.
Keeping it Fair for Everyone
A strata title property, whilst existing within a particular shire or local council, will also attract its own set of guidelines that must be adhered to.
For an investor this is a huge advantage.
Any person who lives or works within this style of development must abide by the by-laws set down by the committee.
These bylaws will include such things as rubbish disposal, owner and visitor parking, noise restrictions, tenant behaviour, care and maintenance of the unit be it dwelling, workshop, or factory.
A landlord will not need to concern himself about these matters as the Body Corporate or its appointed agent will administer to this.
Body Corporate Fees
These fees are calculated fairly so that all owners within a given complex share the costs of maintaining common areas such as driveways, gardens, pools, gymnasium, laundry and even such things as guttering.
These fees are fully tax deductible provided the funds are used to repair and maintain the property and not for capital improvement.
As this is usually the case it is considered an expense of the investment so it is a win win. The property is well cared for and you are able to write it off.
Whilst some capital improvement may be considered by the fund, a special levy will be applied for this purpose. This levy is not tax deductible but does go towards the calculations to offset against any capital gain should the property be sold.
An investor of this style of property will never experience that urgent phone call in the middle of the night or need to come up with repair money for these areas quickly as the manager is already there for them.
Obviously as an owner you or your agent are expected to participate in meetings and vote appropriately to ascertain the future planning of the property.
Strata Management Agents
Oftentimes, an agent is appointed to oversee the overall care and maintenance of the property and they can also be employed to assist each individual owner with issues of maintenance and repair.
Prudential Real Estate assists many property owners with their strata investments and ongoing management.