Rental properties are a great investment, but purchasing them requires careful consideration. This is particularly true when buying property within a strata scheme. Strata schemes have owners corporations which are made up of all the owners of properties within the scheme. The corporation is charged with repairing and managing the common amenities such as gyms, lifts, driveways and pools within the property. It also sets the regulations that all owners and tenants should adhere to. Before buying into an owners corporation, you need to address the following issues which can significantly affect your investment choices.
Analyse the by-laws and regulations
All strata schemes have by-laws and statutes, and some of them may not suit your investment needs. For example, some corporations do not allow pets or any animals on the property. While this eases management of the properties within the scheme, it can make your rental units less attractive to potential buyers who own pets. Before buying into an owners corporation, go through the by-laws with your conveyance to ensure that they suit your investment needs. Do not bind yourself to regulations that will negatively affect your potential clients in the market.
Understand your property boundaries
All owners corporations are formed in strata schemes that have common amenities. Before buying into the corporation, make sure that you know your property lines. Most laws require that you carry out maintenance and repairs of all facilities that are listed within your property. Understanding this can help you assess the costs that you expect to incur as an owner. Also, ask about the common amenities and the amount that you are supposed to contribute towards their maintenance. Do this beforehand to determine whether the investment is viable.
Inspect the common areas
The way the common areas in the strata scheme are maintained will determine how attractive your units will be to potential tenants. Before buying, inspect these areas and look at how the owners corporation is managing them. Are the lawns neatly mowed? Is the swimming pool clean? Are the floors and driveways clean at all times? Inspecting these will give you an idea of how well your money will be used in improving the kerb appeal of the property. Well-maintained amenities will attract tenants fast. As a result, you will begin enjoying returns on investment within a short period.
Look into these issues before buying into an owners corporation to ensure that your interests are safeguarded before investing. You can talk to a real estate expert for more information on owners corporations before investing in rental property.