Do Committee Decisions influence Property Values?

Not all lot holders have the same income stream and their ability to fund improvements is not limitless.


To live in a scheme should be a decision not taken lightly as you become part of a community and decisions on expenditure, behaviour and external appearance of lots is not yours alone. This can cause many problems with the loss of autonomy, however if all lot holders can work together for the common good of the scheme it represents good value for the investment.

 Strata title developments are suited to first time buyers, investors, semi/retired people, families, in fact the whole gamut of society. The question remains, how does the committee manage to represent the interests of all owners? Particularly when the act does not require all owners to partake in all decisions.  In many cases the committee consists of three, four or five people who have only nominated to be on the committee as they have the time to commit to the role on offer. 

In some cases, the committee may consist of professionals that want to upgrade common areas such as the pools, lifts, lobbies, external painting or gardens in order to maximise their return on investment. These types of people generally are interested in a return on their investment by maximising property values – they renovate, make a profit and subsequently upgrade to another complex. On the other side of the spectrum is the more conservative approach to keep levies low, these people want cost saving measures to be the priority when budgeting and setting levies.

What is the possible outcome over a period of time if each group has their way?

Conservative thinkers – Save money by cutting budgets and keeping levies low, engaging contractors at the lowest price and fixing items rather than replacing them. This can result in some owners resenting paying levies as they perceive that nothing is being done to improve the property and that the building is only being ‘maintained’ rather than being improved.  This could also lead to the possibility of a ‘special levy’ if sufficient funds are not put into the sinking fund if a major expense becomes essential. Conservative owners also see lower levies as a benefit for potential buyers. Non-conservative owners and committee members may see this as selfish by only considering their own needs and not providing the necessary prerequisite for rising property values.  

Forward thinkers – This type of owner or committee member will want everything to be done now! A larger than usual proportion of levies should be budgeted towards replacement of items and upgrading the property to stay in touch with cutting edge ideas to ensure the complex stands out from the rest.  This will ensure that the values will continue to rise. Many conservative owners will resent spending money on repainting the building with the mentality that just because some people hate the colour does not mean the building should be repainted. The forward thinkers believe that the increase in levies will be paid back tenfold in higher property values being achieved. This type of attitude can upset owners that are opposed to ‘fixing something that isn’t broken’.

Luckily, most buildings have a good mixture of people swaying sensibly in both directions in order to maintain the status quo. Unfortunately for those living in strata, a rundown body corporate complex just doesn’t have the same financial appeal as a rundown house in the real estate world!  


Paul Wood has over 15 years industry experience including community management, management rights, accounting and development. He joined SSKB in 2001 as a body corporate manager with a large portfolio of prestigious Brisbane buildings. Due to Paul’s accounting background he was appointed as the group financial officer in 2004, he then opened our Victorian office along with establishing a large management rights operation.

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