First-time Property Owners: 3 Things You Can Learn from a Pre-purchase Strata Inspection Report

25 July 2016
 Categories: , Blog

Buying real estate units comes with a variety of excellent amenities. These amenities include pools, saunas, and spas, playing courts, steams and function rooms. This is the beauty of communal investing, which make it easy to pool resources and set up certain amenities that would be expensive when you do them alone. However, such communal investing comes with many obligations and it is important that you understand the provisions before you get into a purchase agreement. A pre-purchase strata inspection report can help you understand the obligations that you will have to fulfill when buying property communally. Here are the important things you will learn from the report:

Financial Status of the Property

What is the financial status of the building and other amenities? Are they mortgaged property that require periodic payments? You need such details on the financial status of the building to assess whether you will be able to shoulder those costs. You will also learn about the period within which you are supposed to give a notification to the other owners in case you are unable to fulfill your financial obligations. In this way, you will avoid hefty penalties imposed on you whenever you fail to honour your financial obligations.

Management Rights

Pre-purchase inspection reports also provide details about the management of the property you are buying. This includes the process of appointing or electing the property manager and the period within which the property manager will serve. In case of a problem, the report also enlightens you on the procedure you should follow to launch a complaint against the management. You also learn what you must fulfill for you be considered eligible for a property management position. Lastly, the report also details the various contracts that you will sign with the management regarding payment of subscription fees among others.

Insurance Report

Considering the huge investment you pump into the purchase of the property, it is important to insure for indemnity in case of any possible damage. A pre-purchase strata inspection report is prepared in conjunction with your insurer to provide key details about the insurance plan of the property. This includes the amount of money you pay for insurance premiums, co-insurance arrangements (if you have more than one insurer for that property) and the specific perils covered by the insurance policy. This will help you make a wise investment decision and go for property that you feel is adequately covered at a reasonable rate.