Body corporate is a legal entity created to take responsibility for common property and is most commonly seen in townhouse, apartment or housing complexes.
When creating developments, it is cost effective to create multiple homes with shared amenities, areas and structures which a body corporation can then take responsibility for. Sometimes this involves pools and gyms while other items are simply utilities, dividing walls or communal parking bays and gardens.
Here at Manasons, we’re not fans of body corporate because their existence means the owner doesn’t have full say over their investment or their budget. These amenities may provide access to features otherwise unavailable but the downside of this access is the funding responsibility taken by the owner regardless of whether the benefits are used or not. Some charges may include utilities such as water or gas because it’s ‘cheaper’ to install one service in the development and share these costs, rather than pay to have them separated. The body corporate can also increase these charges at their discretion or as needed and the property owner must pay. Yes, you may have the option of sitting on a committee but ultimately you will run the risk of being voted against your personal wishes or finding that managing a ‘fair’ split is virtually impossible.
For example, a friend of ours had a unit where he paid his share of joint water consumption charges. As a single man who travelled regularly, he was rarely home but his fees were calculated based on the size of his unit so he paid the same as his neighbours who were a family of 5. Does that seem fair? In another example, a friend of ours was offered an out of town job for a few years and didn’t want to sell her apartment. Her body corporate only allowed 5% rentals in the complex so she was up for her accommodation costs in the new town as well as the mortgage for her apartment because she wasn’t allowed to rent.
Depending on the size and committee membership of the complex, body corporate can also get very invasive by telling you where you can and can’t park, what you can and can’t put outside, whether you can rent your investment or not and even where you can put your barbecue or hang your clothes.
At Manasons, we specialise in low maintenance inner city living which provides all the benefits of the popular and affordable townhomes you see advertised but we will never opt for a body corporate arrangement. We prefer the added investment of completely independent houses which will result in control of your budget and decisions relating to your investment.