A body corporate, also known as a homeowners association or property owner association, is a legal entity that represents the property owners within a multi-unit residential or commercial development. It’s responsible for managing and maintaining common areas and facilities, such as pools, playgrounds, or gardens. It also sets and enforces rules for the use of these common areas, as well as for the overall maintenance and appearance of the properties within the development.
The body corporate is typically governed by a board of directors, who are elected by the members of the association. The board makes decisions on behalf of the body corporate and for managing the financial affairs of the association. The board may also hire staff, such as a property manager or accountant, to assist with the day-to-day operations.
All these costs are covered by fees that are paid by the property owners, usually in the form of monthly or annual charges. The exact costs covered by body corporate fees can vary depending on the specific development and the services provided. However, some common expenses that may be included in body corporate fees are:
- Maintenance and repair of common areas: This can include landscaping, cleaning, and general repairs to common areas such as stairwells, elevators, and car parks.
- Insurance: Body corporate fees may cover the cost of insurance for the development, including public liability insurance and insurance for common property.
- Security: Some developments may have security measures in place, such as security guards or surveillance cameras, which may be paid for through body corporate fees.
- Utilities: In some cases, body corporate fees may cover the cost of utilities for common areas, such as electricity and water.
- Management and administration: Body corporate fees may be used to cover the cost of hiring property managers and other professionals to manage and administer the development.
- Reserve fund contributions: A portion of body corporate fees may be set aside in a reserve fund to cover future repairs and maintenance expenses.
- Special assessments: In addition to regular body corporate fees, owners may be required to pay special assessments for one-time expenses that are not covered by the regular fees. For example, if the development needs to make a major repair or upgrade, a special assessment may be levied to cover the cost.
Body corporate fees are not the same as property taxes, which are paid to the local government.
In some cases, body corporate fees may be paid directly by the owner of the unit. In other cases, the fees may be included in the rent or lease payment if the unit is being rented or leased out.
It’s important for potential buyers or renters to be aware of the body corporate fees associated with a particular development, as they can add significantly to the overall cost of owning or renting a unit.
It’s also a good idea to review the body corporate rules and regulations before purchasing or renting a unit in a development, as these can impact the rights and responsibilities of owners and renters.
If you have any questions about the functions of the body corporate, the expert team at Capitol can help! Get in contact here: https://www.capitolbca.com.au/contact-us