Special levies significantly impact the assessed value of community and strata title properties, a detail that family law practitioners must verify before finalizing settlements. A special levy is an additional charge applied to owners in a community title building, paid on top of regular Body Corporate fees. These standard fees typically divide into an Administration Fund for daily operations and a Sinking Fund for future maintenance. A Quantity Surveyor establishes these initial funds, assuming steady maintenance and cost-of-living-style increases. However, costs frequently rise faster than the original budget allows. In Brisbane, the preparation for the Olympics is expected to generate several high-cost projects that strain these funds.
Structural Issues and Immediate Costs
When a building develops a structural fault, such as water ingress or requires a roof replacement, urgent work becomes necessary to stop further damage. The sinking fund often lacks the necessary capital, forcing the Body Corporate to impose a special levy on all unit owners. These charges are mandatory; if imposed, every owner must pay their share. One writer recently assessed a unit with a levy as high as $100,000, which represents a substantial reduction in the client’s asset position. Buyers identify these liabilities through the Seller Disclosure Report, which includes Body Corporate records, so sellers cannot hide them.
Valuers rarely request Body Corporate minutes as standard procedure. They usually discover levies through conversations with local agents or prior knowledge of the building’s financial history. If a valuer learns of a one-off levy, the market value is adjusted downward to reflect the debt. Sometimes, the impact is visible immediately; a unit may sell well below market expectations because the owner lacked the funds to cover the levy and had to sell with the debt attached.
Verification and Financial Impact
Before proceeding with a valuation, professionals must check if the property is subject to a community or strata title scheme. It is also essential to ask if the client is aware of any levies or structural issues. If the answer is affirmative, requesting the Body Corporate minutes is necessary to confirm the amount and timing of payments. Failing to verify this information can leave a client’s asset pool significantly lower than expected. A special levy can shift a property’s value by a large margin, so asking about it early protects the client from being blindsided by an unforeseen liability.
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