What would you advise..

Been trying to explain to one of our daughters about the way things work within property investing and who pays what..

She bought her own unit in a block of 4 a while back , one problem as I told her from the start was there is only one water meter for the entire complex,and after the water bills come in a few times she is starting to think about what I said and the balance of costs between the 4 units..

So I have asked her to go to the BC and as the total costs for plumbing would be 2500-3000$ for a meter for each unit,as 2 are like single people,the other 2 rented to 4 people per unit so the water costs per unit will be vastly different...

 

I think this is the type of thing she may just have to suck up and chalk up to experience. It's one of the downsides of owning in a bodycorp. If I was one of the other owners I wouldn't fork out for this if asked(I do have a property in a bodycorp with the same issue). There are too many variables with this, the cost for example, the time it would take, the inconvenience, how it would look afterwards etc...

Getting anything approved in a bodycorp is a royal pain. Probably a good lesson to try and see how far it goes.

Something to consider is that numbers of people in units doesn't remain static, she may be the one paying more for water at the moment but she may have multiple people in her unit at some stage and then she'll be the one getting cheaper water...

 

What I said the question?

The people with single people will vote for it and the ones with 4 may vote against it but since they are out to investors t is likely they will also vote yes as they may be able to charge the tenant water consumption.

It would also attract the appeal for future buyers not having to share but would it increase a valuation to extract equity I am not sure.

 

Thanks Kassy, there is only 4 in the BC , sinking fund has about 24k she already talked to 3 out of the 4 unit owners 3 said they would like it to change so the approval part does not seem to be a problem as 3 live there and one is a renter,cost wise complete BCC legal is just under 3k complete,thanks again..

 

That's the way I,m thinking,as this did not go to plan it was going to be her first investment property but our daughter moved in and with that came a lot of costs some only now would has been better by just renting it out from day one,thanks..

 

Would be different if the others were 4 per unit were both PPOR as they would be in worst position but with 3/4 votes for yes I would get it done.

 

@willair I'm glad she has the majority of owners onside, mine is only one of three and it's frustrating getting anything done...

 

She could offer to pay more of the cost if it's more of an advantage to her - might pay for itself in a year or two.

 

It will cost nothing for your daughter to put the proposal to the next BC meeting. She will have a better chance of success if she can provide details of cost involved. Not sure if it will succeed on a majority vote, or if 100% needed.

As it would appear to benefit 3 owners, if unsuccessful it may be an alternative for the three to agree to share the costs.

A formal approach to the BC is the first step.
Marg

 

^^^^ I like your way of thinking.

Hmm, small block of 4?

The daughter could buy 2 more units in the block and have a majority vote at the AGM. Even vote to give the Strata managers the flick and self manage.

In any case the amount of water usage cost wouldn't be that much different....maybe $100 or $200 pa? In which case it could take 50 years to recoup the cost.

 

Individual metering is one of the first things I ask a client to check when they look at purchasing an investment unit. You can't charge tenants ANY water if it's not individually metered. I would imagine this would amount to some sort of capital benefit when it came time to value/sell to units, and the cost of the meters isn't so bad.

 

If that is the case I would follow through and have this completed, with each unit individually metered and the unit certified as water efficient the cost can be passed onto the tenants