The Strata Property Act came to effect on the 28th of July 2016. This act made it easier for strata property owners to wind up or dissolve their strata corporation by lowering the voting threshold to 80 per cent.
Dissolving a strata corporation could be beneficial due to many reasons. As strata properties reach the end of their life cycles, they require more frequent repairs and more expensive maintenance which the property owners may not be willing to pay. As developers look for new development opportunities, aging strata buildings become appealing assets. As a strata owner you could get top dollar for your unit in this case.
However, it is important to note that winding up a strata corporation is a complicated process and you must take advice from a reputed property agent and a lawyer to take you through a successful wind up.
Here are a few pointers to dissolve a strata property successfully:
1. Each strata corporation is unique
The physical condition, zoning and the potential for rezoning for each strata property is unique. It may be made of a diverse group of owners too. Make sure that your stake holders understand that you are in a wind up conversation and will need their support and cooperation so that you can achieve your goals.
2. Information meetings
The key owners and the strata council members must understand the wind up process thoroughly. Informational meetings are essential so that everyone is well informed about the proceedings. Invite advisors and experts to these meetings so that all doubts can be cleared instantly. Overall, ensure that the right information is provided to the other owners and tenants.
3. Distribution of sales proceeds
The distribution of the proceeds is determined by the Strata Property Act and the legislature that was prevalent prior to this act. The distribution of the sale proceeds should be determined early in the process.
4. Conditions for listing agreements and purchase and sales agreements
The inability of the strata corporation to force owners to sell their units before the windup process is complete must be addressed by the wind up agreement. The wind up approval process must be reflected in the agreement. Approval by the owners, the court and the due diligence process that is required by the developers must be accounted for.
5. Sale of property
The nature of marketing selected and the timing for sale might be different for different kind of properties. There may be just one logical buyer willing to pay a premium amount for the property, or there may be many buyers. It is hence essential to choose the right real estate agent for this purpose. Appraisals from professional appraisal firms may also be required in some cases.
6. Authorizing windup
The winding up of a strata property could be a long and stressful process that requires strict adherence to the Strata Property Act. It’s important that you seek authorization before marketing your property.
You must provide further information to the owners on the current and potential zoning. In order to accomplish this, ensure that you work with your real estate brokers and appraisers. They can help you understand the timing and the realistic potential of any re-zoning so that your strata captures it’s fair share of that potential.
8. Land title and conveyancing process
Work closely with the Land Title Office staff and be sure to look for lawyers that provide the software and precedent knowledge to help expedite the process and achieve cost savings.
If you are think of buying or selling in West Vancouver, call Naz Allahyari for a free home evaluation today.
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