Almost Home Owners again

The fools have accepted us into the body corporate ! Probably should have told them about our incredible singing hound with her ever expanding musical reportoire. Well, their silly fault if they didn't ask. They'll learn soon enough. So, after giving our current financial statement, financial history for the past 5 years, and my inside leg measurement, we've now been deemed to be acceptable to buy an apartment. At least, 10% of it. We pay the rest at the end of September when we take possession. So at this stage we probably own the particuarly grubby corner of the downstairs bathroom. For those not familiar with apartment buying, here's the low down. The Swedish term is Bostadsrätt. Which essentially means "right to live". You pay a one off set amount to the owner of the apartment for the right to live in that apartment. Forever. You then pay a set monthly fee to the owner of the building. To maintain the outside of the building, and also to supply all the services to your apartment. Usually the building owner is a company made up of all those who have bought apartments in the building. So in effect you own part of the building, as well as your apartment. But the building has no value to you, you can't borrow against it's value, sell your part, or anything like that. And it's a compulsary purchase. Apartments are usually cheaper than houses to purchase, but take the time to factor in the body corporate monthly fee, versus the monthly running cost of a house, when determining which is the better value for money for you. If it's a small complex then all residents might sit on the building owner committee. If it's a large complex with 20 or more apartments, then not everyone is going to be on the committee. Anyway, it's usually the committee that decides how the monthly rental money gets spent, once all the bills have been paid. Most will have a long term maintenance plan, which often gets set at the annual meeting, where all residents can front up to. The plan might be to repaint the exterior this year, upgrade the heating, or replace all ovens with new ovens in every apartment. Some companies will set aside a certain amount of money from your monthly rental, specifically for the maintaining or upgrading over your particular apartment. A renovation fund. This is a really good complusary saving scheme for a new bathroom, or new wallpaper. Not all companies have this in their rental, so it's worth checking first. It was a bonus for us to find out that there is currently 22,000kr sitting in our apartment fund. Enough to fully renovate the place throughout. The general rule is that you purchase what you need first and then request release of funds from the committee. It's your money so they can't really deny you if you've spent 20,000kr on a combination lava lamp / disco ball lounge lamp. My advice is to investigate the monthly fee thoroughly before committing to a purchase. Prices vary a lot, depending on the complex, and what they offer. Most should include water, heating, and basic cable tv, as a minimum. A new building might have a higher fee, as it's likely there is still a mortgage owing on the building construction. Bear in mind that you are responsible for the debts of the building, as well as your own apartment. But hopefully the monthly fee will reduce as the building mortgage decreases. An older building is likely to have a pretty static monthly fee. A renovation fund portion will also mean a higher monthly fee. Wasted if you have a flash new apartment, and don't intend to do any redecorating. But you can't opt out of paying it. It's a good safeguard for the residents as a group to ensure that all apartments are well maintained, and hold their values. If your building has a laundry room ( Tvättstuga ), then USE IT. Don't waste your money on buying and running your own washing machine and dryer. The reason is one of simple economics. Everyone is the building pays for the laundry room already in their compulsary monthly fee. So save yourself the 15,000kr and ongoing electricity costs. Major savings there. Car parks or garages are usually offered, and sometimes are compulsary with the purchase of the apartment. They generally have their own contract, and a seperate fee. Which isn't included in your monthly body corporate fee. So ask the question there. That's our task for this week.