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Serving Sri Lanka

This web log is a news and views blog. The primary aim is to provide an avenue for the expression and collection of ideas on sustainable, fair, and just, grassroot level development. Some of the topics that the blog will specifically address are: poverty reduction, rural development, educational issues, social empowerment, post-Tsunami relief and reconstruction, livelihood development, environmental conservation and bio-diversity. 

Thursday, February 22, 2007

Condominiums: Solution for post tsunami housing management

Daily Mirror: 22/02/2007" By Kirthi Hewamanne

Many housing projects have already been completed to house tsunami affected families with the funding of local and foreign organizations. Now it is important to set up a management system for these schemes to prevent a repeat of problems arisen in many government sponsored housing schemes. It is not practical for the Govt. or the donor organizations to manage these schemes on a long term basis.

Constructing unauthorized structures, encroaching into common areas, operating businesses in the complex, no proper garbage collections and disposal system, renting units without approval, overcrowding and unauthorized parking are the problems which will escalate into major issues in the long run.

Unless a proper management system is introduced and implemented, these problems can escalate and become out of control. Criminal activities, intimidation of residents by individuals within the scheme are also some of the problems in these complexes.
These problems are also there in some of the State sponsored housing schemes due to a lack of management systems introduced at the beginning.

Condominium management style is the best concept which should be introduced and implemented in these housing schemes.

Condominium is a private home ownership method. Therefore, it shouldn’t have minimum Govt. control and interference. They should be managed by the Residents Association.Most people think of a condominium as either a high-rise or low rise apartment building. It is a home ownership method and not the shape or size of a building. Condominiums can also be townhouses, semi-detached houses, or even fully detached houses. Condominium housing is successfully implemented for low, middle and high income groups. The units are individually owned and the land and other amenities are jointly owned with the rest of the unit owners. An awareness program of the Condominium Concept should be conducted to educate the residents of their rights and responsibilities. It has to be closely monitored and implemented by professionals with in-depth knowledge of the condominium concept.Graduates who are seeking employment in these respective areas can be trained to be Managers who can work with the residents to run day to day affairs of the complex. These corporations can make the owners more responsible to look after their housing schemes collectively. This will enhance the value of their own units.

RIGHTS & RESPONSIBILITIES OF RESIDENTS

When buying an apartment in a condominium, the buyer must be aware of his/her rights and responsibilities

The condominium concept has the advantages of financial benefits from multiple ownership and also the disadvantages of multiple relationships. Therefore, the Condominium Corporation has an important role to play in the smooth running of the condominium complex. If you plan to buy a condominium, it is often said that buying the condominium is buying a life style. There are many advantages to condominium ownership. It may be less expensive than other types of homeownership. When you buy a single family detached home with all the benefits and facilities available in condominiums it can be expensive. Condominiums provide an “instant sense of community”. Condominium corporations may set restrictions on such things as owning pets and using common areas for the welfare and benefit of other residents. This is a private homeownership method, and due to lack of knowledge of the concept many serious mistakes have been made when setting up condominiums. In a condominium complex. units are owned exclusively by individuals and all other areas including land are jointly owned by these same individuals. Therefore all unit owners are responsible to create a satisfactory living environment for themselves and the other owners.

• What is a condominium property?
A condominium property is one where units of a building are sold to different buyers, while the areas and elements common to all, remain within the common ownership of all the unit owners. The buyers own their units exclusively, but the land, roadways, playgrounds, corridors, sewers etc., which serve all the units, are jointly owned by all the buyers.

• What would you acquire when you buy an apartment?
You get the exclusive ownership of your apartment as defined in the Condominium Plan. You are also a part owner of the common areas and services and the undivided land on which the property stands.

• How much of the common areas do you own?
In a condominium property you own the apartment exclusively and a share of the undivided land, common areas and services, based on the floor area of your apartment. This share is also filed with the Condominium Plan and determines the share owned by you for as long as the condominium property is intact. If you sell your apartment you also sell your share. The allocation of shares is usually based on giving one share per apartment, but can also be done in more complex ways. Therefore, if a condominium has 50 apartments and all are given one share each, you would own one fiftieth (1/50) of the land, common areas, and services. Another way of allocating of shares is based on the floor area of the individual units.

The writer is a Condominium Specialist and an award winning Realtor in Canada with wide experience in all aspects of Real Estate. Held membership in Canadian Real Estate Association & member of the Realtor Political Action Committee.

• Who maintains your apartment?
You are responsible for the maintenance of your apartment, within the boundaries marked in the Condominium Plan.

• Can you make structural changes to your apartment?
You cannot make structural changes in your apartment since it alters the Condominium Plan, and since it will affect other property owners in the condominium. If you want to make a change, you will have to get prior approval from the Condominium Management Corporation. Approval may not be granted if the Management Corporation is of the opinion that it may be detrimental to the structure of the building.

• Can you make changes to the finishes of your apartment?
You can make changes to the finishes of your apartment, provided you do not in any way affect other owners within the condominium. You can do colour washing, re-tiling and change fittings of the kitchen and bathrooms.

• What is a Management Corporation?
Upon registration of the condominium in the Land Registry, the Management Corporation which is a legal body is formed to manage the condominium property and administer the common elements and corporate assets. It is mandatory that all unit owners become members of the Corporation. The members appoint a Council to run the day to day affairs of the Condominium. The Corporation requires the unit owners to comply with the Apartment Ownership Act. All voting is on the basis of one vote per residential unit.There will be a constitution for the Corporation and all unit owners should have a copy.

• What are the functions of a Management Corporation?
The Management Corporation is the owner of all common areas, common services, and the land on which the condominium stands. It is responsible for insuring the entire condominium and it is also responsible for the maintenance of all common areas and services. The Corporation requires the unit owners to comply with the Act, the by-laws and the rules. It is their responsibility to demolish all unauthorized structures built, which are not in the original Condominium Plan. This law will be strictly enforced with the help of the newly formed Condominium Management Authority.

The Corporation may hire employees, contractors etc. and make payment for services rendered. The Council of the Management Corporation will appoint Auditors, enter into management agreements and supervise generally the affairs of the Corporation. It will determine an Annual Operating Budget for the anticipated expenses such as on-going maintenance, exterior painting, landscaping, insurance, legal and accounting charges and other current expenses. The Corporation is accountable to the share holders.

The writer is a Condominium Specialist and an award winning Realtor in Canada with wide experience in all aspects of Real Estate. Held membership in Canadian Real Estate Association & member of the Realtor Political Action Committee.

• Who provides funds to the Management Corporation?
Funding for the Management Corporation should come strictly from the condominium unit owners. The amount payable by each unit owner is based on his undivided share he owns of the condominium complex. The Management Corporation will compute the amount payable by each unit owner and collect it from them each month.

• Who pays for the water and power consumed by an apartment owner?
The owner or tenant will pay for power, water and other services like telephone etc.

• Who pays for common area lighting?
The Management Corporation will pay for common area lighting, and also for th maintenance of the lighting.

• Who pays local authority rates and taxes?
It is the responsibility of the unit owners.

• Who clears the garbage?
A garbage bin is provided which will be cleared by the Local Authority. The Management Corporation will give instructions with regard to clearing of the garbage.

• Who looks after roads, drains, and street lighting?

The Local Authority will take over this unless otherwise specified by the Management Corporation..

• Who will look after the water tower and main supply line to your condominium?
If a service line within the condominium needs repairs, it is the duty of the Management Corporation to look after this aspect.

• What happens if a condominium is destroyed completely by fire?
The Management Corporation will receive compensation if the condominium is insured. At that point the share holders may decide to rebuild the condominium using the money or they may decide to sell the land. In which case the compensation received and profits from the sale of land will be divided among the shareholders in proportion to the shares they hold.

• Landscaping the Common Areas. Who should do it?
It is the duty of the Management Corporation and the unit owners can make
suggestions to the Corporation.

• Who should decide the overall policy for managing the condominium?

It is the shareholders (unit owners) who prepare the by-laws, rules and regulations to be followed by the Corporation. They must be approved by not less than 51% of the unit owners.
As an alternative, the owners as a Corporation decide to hand over the total
management to an outside Organization. The Organization can sign an Agreement with the Management Corporation, and the unit owners will pay the management fee to the Corporation, who will pay the outside Organization.

• Who maintains your apartment?
You are responsible for the maintenance of your apartment, within the boundaries marked in the Condominium Plan.

• Can you make structural changes to your apartment?
You cannot make structural changes in your apartment since it alters the Condominium Plan, and since it will affect other property owners in the condominium. If you want to make a change, you will have to get prior approval from the Condominium Management Corporation. Approval may not be granted if the Management Corporation is of the opinion that it may be detrimental to the structure of the building.

• Can you make changes to the finishes of your apartment?
You can make changes to the finishes of your apartment, provided you do not in any way affect other owners within the condominium. You can do colour washing, re-tiling and change fittings of the kitchen and bathrooms.

• What is a Management Corporation?
Upon registration of the condominium in the Land Registry, the Management Corporation which is a legal body is formed to manage the condominium property and administer the common elements and corporate assets. It is mandatory that all unit owners become members of the Corporation.

The members appoint a Council to run the day to day affairs of the Condominium. The Corporation requires the unit owners to comply with the Apartment Ownership Act. All voting is on the basis of one vote per residential unit.
There will be a constitution for the Corporation and all unit owners should have a copy.

• What are the functions of a Management Corporation?
The Management Corporation is the owner of all common areas, common services, and the land on which the condominium stands.

It is responsible for insuring the entire condominium and it is also responsible for the maintenance of all common areas and services.

The Corporation requires the unit owners to comply with the Act, the by-laws and the rules. It is their responsibility to demolish all unauthorized structures built, which are not in the original Condominium Plan. This law will be strictly enforced with the help of the newly formed Condominium Management Authority.

The Corporation may hire employees, contractors etc. and make payment for services rendered.
The Council of the Management Corporation will appoint Auditors, enter into management agreements and supervise generally the affairs of the Corporation. It will determine an Annual Operating Budget for the anticipated expenses such as on-going maintenance, exterior painting, landscaping, insurance, legal and accounting charges and other current expenses.The Corporation is accountable to the share holders.

• Who provides funds to the Management Corporation?
Funding for the Management Corporation should come strictly from the condominium unit owners. The amount payable by each unit owner is based on his undivided share he owns of the condominium complex. The Management Corporation will compute the amount payable by each unit owner and collect it from them each month.

• Who pays for the water and power consumed by an apartment owner?
The owner or tenant will pay for power, water and other services like telephone etc.

• Who pays for common area lighting?
The Management Corporation will pay for common area lighting, and also for the
maintenance of the lighting.

• Who pays local authority rates and taxes?
It is the responsibility of the unit owners.

• Who clears the garbage?
A garbage bin is provided which will be cleared by the Local Authority. The Management Corporation will give instructions with regard to clearing of the garbage.

• Who looks after roads, drains, and street lighting?
The Local Authority will take over this unless otherwise specified by the Management Corporation..

• Who will look after the water tower and main supply line to your condominium?
If a service line within the condominium needs repairs, it is the duty of the Management Corporation to look after this aspect.

• What happens if a condominium is destroyed completely by fire?
The Management Corporation will receive compensation if the condominium is insured. At that point the share holders may decide to rebuild the condominium using the money or they may decide to sell the land. In which case the compensation received and profits from the sale of land will be divided among the shareholders in proportion to the shares they hold.

• Landscaping the Common Areas. Who should do it?
It is the duty of the Management Corporation and the unit owners can make suggestions to the Corporation.

• Who should decide the overall policy for managing the condominium?

It is the shareholders (unit owners) who prepare the by-laws, rules and regulations to be followed by the Corporation. They must be approved by not less than 51% of the unit owners.
As an alternative, the owners as a Corporation decide to hand over the total management to an outside Organization. The Organization can sign an Agreement with the Management Corporation, and the unit owners will pay the management fee to the Corporation, who will pay the outside Organization.

The writer is a Condominium Specialist and an award winning Realtor in Canada with wide experience in all aspects of Real Estate. Held membership in Canadian Real Estate Association & member of the Realtor Political Action Committee.


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