Forced sales for Queensland unit owners? Watch this space.
As buildings age and the cost of maintaining those buildings increases, we are sometimes asked how a Body Corporate can agree to dissolve and sell the property to a developer. This can be a tense time for each of the property owners within a Body Corporate, especially where there is a mix of owner-occupiers and investors.
Unanimous decision currently required.
The current system with respect to scheme termination (a Body Corporate dissolving itself) is clear. All owners must agree. If there are 50 units in a scheme and 49 want to sell to a developer and one doesn’t, no sale can occur. There are potential avenues to apply to the District Court for orders where there is a stalemate.
‘Majority Rules’ coming soon?
The Queensland Government recently engaged a review of Queensland’s Property Law.
The review made several recommendations regarding Queensland’s Body Corporate laws.
This includes a proposal to reduce the current threshold for scheme termination, essentially allowing for a certain percentage of owners to agree and take along unwilling sellers in that process. What percentage of owners that would require is yet to be determined but the report offers the following suggestion –
- a minimum requirement of at least 75% of owners to vote in the resolution to terminate the scheme; and
- a maximum of 15% of lot owners voting against the proposal giving an effective 85% threshold
While the government has yet to publicly comment on the report, a response may occur sometime this current term of Parliament. With the cost of maintaining aging buildings continuing to rise, we expect this issue is likely gather further political attention.
We will watch with interest and keep you updated.
KRG Conveyancing
