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Sinking Funds: Protecting The Value Of Your Property Investment

June 17, 2022

Do you understand the mechanics of your sinking fund? Many of us contribute hundreds, or thousands of dollars towards the sinking fund without our body corporate fees each year. But why, what is this for? How do we know it is being appropriate managed and doing what it is supposed to? How does it protect the value of our investment? How do we accurately forecast for future works?

Firstly, what is a Sinking Fund?

A sinking fund must allow for raising a reasonable capital amount from Owner’s contributions, to provide for necessary and reasonable spending relating to replacement, repair and/or maintenance of the property’s capital items. The law requires a sinking fund budget to consider the current financial year, and also the reservation of an amount to meet likely spending for at least the next 9 years.

We have been featured in the June edition of The QLD Strata Magazine. You can view our content on pages 16 and 17, along with other relevant QLD content featured in this edition.