They are becoming endangered species but there are still a few company title apartment blocks around and a shrewd investor shouldn’t necessarily shy away from them.
Company Titles sprang up in the early part of last century when home ownership was more about land than buildings. That’s why they tend to be older, grander affairs with high ceilings and cranky lifts that belong in French noir movies rather than the modern concrete jungles that often surround them (some of the finest examples are up around Macleay St in Kings Cross).
Unlike in Strata Title buildings, where you own the bricks and mortar of your apartment, in Company Titles you own shares in a company that owns and runs the apartment block. Those shares entitle you to occupy a specific apartment in the building.
Company Title apartments tend to be cheaper, partly because banks and mortgage providers will only lend a relatively small amount on a company title, and because you have to be approved by the Directors – ie, your new neighbours – before you can buy. Add in probable restrictions, if not an outright ban, on letting out the apartment and you can see why some potential purchasers would steer clear.
But here are two sides to needing to be approved by your potential neighbours. Nobody really likes that level of scrutiny but if there’s no problem, at least you are less likely to have a bikie gang or backpackers take up residence next door to you.
Other drawbacks include more rules and more stringent observance of them plus the fact that company title buildings don’t come under Strata Title laws so any serious disputes could mean a trip to the Supreme Court.
However, contrary to popular belief, you can let out a Company Title apartment but, again, that’s only with the approval of the other members of the board, who will probably want to approve the tenant too. On the plus side, Company Title buildings tend to be smaller and most of the residents are owner-occupiers so you can get any problems dealt with much more directly.
A lot of Company Title buildings are converting to strata these days because they feel the minuses outweigh the plusses. If you come across an apartment in a building that’s about to do that, you could have found yourself a real bargain. For more information on Company Titles check out the appropriate section in www.aussielegal.com.au.
I have a neighbour who has loud parties most weekends, refuses to turn the music down, even after midnight, and will spend hours saying goodnight to his guests in the lobby outside our door. He is very aggressive when we complain and, when we approached the body corporate about it, we were appalled to discover he is the chair. Is there anything we can do? Lara G – Elizabeth Bay
My first thought was “move out” but, then, why should you? You are the victim here. Obviously the bylaws of your building will prohibit that kind of behaviour but that’s not much use if the chairman is flouting his own rules. You need to mount an aggressive campaign to have him ousted at your next AGM and that will require drumming up support from your neighbours as well as other owners.
Meanwhile you should be calling the police whenever there’s excessive noise after midnight, then write to the Executive Committee, with a copy to the Office of Fair Trading, outlining each breach as it occurs. These letters must be minuted by the EC and retained for public inspection. If they’re not it means your Executive Committee is in breach of Strata Law and you can approach the OFT to have it step in resolve the situation.