Repair v Redevelop? What you need to know

At Sydney Strata Specialist we are asked about the new changes in legislation regarding the 75% rule in selling / redeveloping the strata scheme.

The strata scheme may be facing repairs either immediately or in the near future –  these could mean that current owners raising tens of thousands of dollars each or even more.  There are vast amounts of buildings in the eastern suburbs that have concrete cancer or fire upgrades that have cost each owner $60,000 each.

The above is an example of Concrete Cancer

Meeting these levies can place an enormous financial burden on owners who are on fixed incomes.  In a lot of cases some owners voted NO or blocked the vote to the repairs as they simply could not afford to have the repairs undertaken.

The Government has recognised that a number of owners have blocked the sale/redevelopment and hence changed the laws to meet the ever-changing world of strata living.

Regardless if the owner’s corporation is looking to ether spending money on repairs or taking advantage of the growth. The majority of the owner’s corporation can now take advantage of the new laws.

Selling off the strata plan could be the way to go.  This use to be very difficult as it requires ALL (100%) owners to agree and sign off on the proposal.   Now the law is changing.

Now it is what is the most financial benefit that suits the majority –  Now that the consent of only a 75% majority of strata unit owners in a block will be required to consent to its demolition. This is in stark contrast to the current laws, which require agreement by 100% of strata unit owners for a block to be sold to a developer for demolition.

With many strata blocks within New South Wales becoming quite dated, ongoing maintenance and renovation is, without doubt, an extremely costly process, with the preferred option being to simply demolish the building.

Some of Sydney’s trendiest eastern suburbs are host to some of its oldest, and least sustainable, buildings.   A large number of buildings constructed in the 1970 had a life expectancy of 40 years.   We have now come to the end of the term.   Buildings that are on the coast are more susceptible to concrete cancer and if your building has not already had repairs due to this then it is only a matter of time.

sydney-strata-manager-old-apartments

Apartment block for sale in Cronulla

Allowing for redevelopment rather than expensive maintenance, offering potential increases in tenancy numbers and far more energy efficient buildings. Some local councils have already increased the height restrictions.

Some developers are offering apartment owners options such as ‘first option to buy deals’ and assistance with temporary or permanent relocation.

Talk to us today and see why we are the best strata managers in Sydney.

 

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