Apartments in the city center of Melbourne, Southbank, Docklands, and Box Hill are popular among Chinese buyers, student families, and investors. The biggest difference between buying an apartment and buying a detached house is that you become a member of an Owners Corporation (commonly known as a “Property Management Board” or “body corporate”), and you share the costs and responsibilities of the entire building.
The Chua Tan Associates only handles properties located in Victoria; buyers can live in Australia or overseas.
First, look at the certificate of incorporation issued by the owner's legal entity.
In Victoria, the seller's declaration (Section 32) usually requires the owners corporation certificate and related documents to be attached. The key points include:
- The amount of annual management fees, and whether the seller is in arrears with payments;
- Has a decision been made or is discussion underway regarding special fees (such as large maintenance fees);
- Maintenance fund balance and maintenance plan;
- Insurance status;
- Whether the owner's legal entity is involved in litigation or disputes;
- Applicable rules, such as whether short-term rentals are allowed, pet ownership restrictions, and renovation restrictions.
For a general method of reading the seller's statement, please refer to Section 32 Reading Guide.
2. Flammable Exterior Wall Materials and Construction Defects
Some high-rise apartments used flammable exterior wall materials. The Victorian government has a dedicated agency to handle the replacement of some buildings. Even with government funding, owners may still bear part of the cost, and insurance may be affected. Additionally, common waterproofing and leakage defects in new buildings can also lead to owners suing the developer or builder, during which time the owners have to bear the legal costs themselves.
Before signing the contract, you should ask whether the building has been listed as a building that needs renovation and check the minutes of the owners' association meeting.
Third, rules to be aware of when investing and buying a home for personal use
- Short-term rentals (such as Airbnb) are restricted in Victoria by the Landlord and Tenant Act and state laws; some short-term rentals are also subject to special taxes.
- Unoccupied properties may involve vacant-property tax, and overseas owners also have additional land-tax fees, see details below. Vacant tax in Victoria.
- Foreign buyers generally need FIRB approval to purchase new apartments and must pay an additional stamp duty, see details here. Important information for overseas buyers when purchasing real estate.
Fourth, common concerns among Chinese families
“Should I buy an apartment for a child studying abroad and register it in whose name?” This will affect the FIRB, stamp duty, land tax, and future inheritance; you should plan ahead before signing the contract.
“The management fee doesn’t seem high; why should I specifically check it?” Lower management fees may mean insufficient maintenance funds, which increases the risk of future special fee collection.
“What if I’m overseas and can’t see the actual situation of the building?” You can have the surveyor inspect the property and have a lawyer review the owners' incorporation documents to clarify the issues before signing the contract.
Example (for illustration purposes only; not a real case): A Malaysian parent is preparing to purchase a second-hand apartment in Southbank for his child studying in Melbourne. When the lawyer reviewed the documents, he discovered that the property management association had discussed exterior wall repairs and possible special levies. The parent consulted with the seller before signing the contract, taking this risk into account when pricing the property.
Why choose us
Our real estate team is led by Ms. Tan Chua, who has been practicing real estate law in Victoria for over thirty years and has handled numerous apartment sales and overseas buyer transactions. We provide services in Mandarin, Cantonese and English. For more information, please see here. Melbourne Real Estate Buying and Transfer Attorney.
Need help?
Welcome to buy an apartment before you do it. Initial consultation by appointment with payment Please have a lawyer review the contract and the owners' association documents before signing or bidding. Overseas parents can participate online.
This article contains general information only and is not legal advice. You should not rely on it for any specific matter. The law may change; please book a consultation for advice on your circumstances.
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