Effective 1st of August, 2013 the Body Corporate & Community Management Amendment Act 2012 (second Amendment Act) changes re section 206 disclosure statements came into force.
The most important change is that section 206 disclosure statements no longer need to include a copy of the Community Management Statement (CMS).
This will come as something of a relief to search agents, real estate agents and solicitors alike. Community Management Statements are often large (the largest I’ve seen is 244 pages long), and for the bigger buildings they change frequently.
Removing the requirement is a welcome bonus.
The idea of making sure a CMS is available to the purchaser, before they enter into a contract to buy, is a good one. There’s a lot of information there that savvy investors make themselves aware of.
That said, the onus of looking at the CMS should rest squarely with the buyer, not the seller or their agents.
Other changes to Section 206 Disclosure Statement
Disclosure statements documents should now be amended by removing the following provisions:
- The extent to which the amount of the annual contributions currently fixed by the body corporate and payable by the lot owner
- Statement to buyer regarding the contribution lot entitlements
- Acknowledgement that the buyer has received a copy of the CMS with the disclosure
In all other ways the disclosure requirements remain the same.
There is no transition period with these changes. All disclosures used in contracts on and from 1/8/2013 should be on amended forms and should not contain a CMS.
NOTE: The information contained here relates to lots in an already registered body corporate. If you are buying a lot in an unregistered body corporate, ie off-the-plan, please review disclosure requirements here.
Unless stated otherwise all the information on this website relates to Queensland legislation.
I have been told my Qld real estate agent will organise a disclosure on my behalf for $230 for the purchaser of my unit. Is this necessary legally for sale to go through and if i owe levies after settlement is it up to me to pay or new owners? Thanks Lynn
Hi Lynn
It is necessary to have a disclosure statement before entering a contract. $230 sounds steep.
You’re still responsible for paying levies until settlement. Your, and the purchasers, Solicitor should pro-rata the levies to settlement date. For instance, if the next levy period is 1/9/2017 – 31/12/2017 and you settle 1/11/2017, it will be beneficial to pay the levy to both get the discount if applicable and avoid any penalties. At settlement you should be reimbursed by the purchaser for the period 1/11/2017 – 31/12/2017 in the settlement statement.