Sinking Fund Forecasts / Maintenance Plans / Capital Works Fund Plans / Reserve Fund Plans
Sinking Fund Forecasts, Maintenance Plans and Capital Works Fund Plans are essentially the same service. They are just called different things in the strata legislation in various states.
Pioneers in the Industry
Leary & Partners pioneered the provision of sinking fund reports as a tool for the management of strata buildings using the company’s unique understanding of the maintenance needs of strata communities. We first developed our sinking fund forecasting service early in 1990 and were the first company in most states to offer this service. We are the people who originally coined the term “Sinking Fund Forecast”.
L&P’s Premium Sinking Fund Forecasts Include
Since the introduction of our service, the strata management industry has embraced the concept of asset management through the use of professionally prepared sinking fund studies.
- In Queensland the Body Corporate and Community Management Bill 1997 makes it mandatory for every body corporate to prepare a sinking fund forecast as a basis for their annual sinking fund budget. The forecast must be for a minimum of 10 years.
- In New South Wales the NSW Strata Schemes Management Act makes it mandatory for all strata schemes to prepare the same type of 10-year sinking fund forecasts.
- In Victoria, The Owners Corporation Act 2006 also requires certain prescribed owners corporations to prepare 10 year maintenance plans.
Whether or not a sinking fund forecast/maintenance plan is required by law, all schemes will benefit from using a sinking fund forecast to comply with their legislative responsibility to budget for expected future expenditure such as painting and replacing equipment.
Commissioning a professionally prepared sinking fund forecast is an important step toward ensuring that your body corporate/owners corporation will have sufficient funds for good maintenance management.
Frequently Asked Questions
A sinking fund forecast is a budget report designed to assist the body corporate/owners corporation with the long-term funding of common property maintenance. The report identifies the major cyclical repair and maintenance expenses that are likely to occur during the forecast period (which can be a minimum of 10 years but is more typically between 15 and 20 years). It then calculates the amount of money that the body corporate/owners corporation will need to contribute each year to its sinking fund, in order to fund the identified work.
Commissioning and following a professionally prepared sinking fund forecast ensures that sufficient funds will be available to keep your building functioning efficiently and looking good. This protects your investment in the building both during the period you own your unit and when you decide to sell.
Yes, it does. First impressions of the building’s exterior and communal areas count enormously with prospective buyers. A building with an adequate sinking fund should always look good. A professionally prepared sinking fund forecast also demonstrates to prospective buyers that provision has been made for future replacement and large maintenance requirements. Purchasers are becoming better informed and are learning to ask questions in relation to administrative and sinking fund budgets. They are aware that bodies corporate/owners corporations that do not adequately provide for maintenance and repairs are a source of future expense.
Yes, it does. A professionally prepared forecast from our company will ensure that all owners pay for the cost of dilapidation that occurs during their period of ownership, in accordance with the entitlement scheme.
It provides a written reminder for major future maintenance and replacement work. Each forecast sets down an estimated time for the major works to be carried out. This can be used as a starting point by the body corporate/owners corporation to remind them of the need for future work.
It may do. It may also mean the owners will pay less. Until a sinking fund forecast has been prepared, it is very difficult for a body corporate/owners corporation to know how much it should have in the fund at any particular time. If the levies you are currently paying are too low to fund essential future works it is better to find out now, while you may still have a number of years to raise the short-fall, than to risk facing a crippling special levy in the future.
Costs vary depending on the size and location. Please visit our quotes page to receive a firm quotation.
Want to know more?
To date, we have surveyed and prepared forecasts for more that 10,000 buildings throughout Australia. Our client base comprises all types of strata and government buildings in various locations around Australia.
If you would like to discuss this service please call us on freecall 1800 808 991 or email email@example.com.