Living in a condominium – purchase, roles, and obligations
If you buy a condominium under commonhold ownership, you accept responsibility for part of a property. And become a member of the condominium association. Read what this means, why a well-stocked renovation fund is important, and what obligations you have as a condominium owner.
Article content
- What is commonhold ownership?
- How is commonhold ownership established?
- The difference between commonhold ownership and a condominium
- Condominium checklist
- Obligations and roles
- The purpose of the rules for condominiums
- Operating costs
- Condominium refurbishment fund
- Condominium management
- Information sheets on condominiums
- Association meetings
- Avoiding conflicts
What is commonhold ownership?
Commonhold is a form of property ownership. It involves purchasing a condominium within a property and acquiring joint ownership of the collective land and the access infrastructure. This purchase is always tied to an exclusive right. This includes the unit as well as the basement and attic. Anything that falls under the exclusive right can be altered as long as the exclusive rights of others are not impaired. There is an exclusive right of use for common areas such as the garden or rooftop terraces; these areas may be used but not altered. The individual commonhold owners of a property collectively make up the condominium association.
How is commonhold ownership established?
In Switzerland, commonhold ownership is established by registering entitlement in the land records. This requires a condominium declaration or a legal basis. This is formed through a contract either among the owners of the property or between an individual owner and the land registry.
The difference between commonhold ownership and a condominium
The difference between the two terms is due to the fact that building ownership is linked to land in Switzerland. So not only do you own a building, but you also share ownership in the piece of land. When it comes to commonhold ownership, this means specifically that you can use and finish the interior of the condominium unit – i.e. the part subject to the exclusive right – however you wish. Common property spaces, such as stairwells or facades, may be altered only with the consent of the co-owners, however.
Obligations for condominium owners
If you decide to buy a condominium, you should be aware that you are also acquiring rights and obligations. For instance, the condominium association is responsible for drawing up rules for the condominium and continuously adapting them to the residential situation and the environment. In addition, the owners also devise a refurbishment plan, which is set out in the condominium rules and is intended to maintain the property. In order to ensure peaceful coexistence, the entire association must also adhere to a set of house rules.
The purpose of the rules for condominiums
The jointly devised condominium rules distinguish between the parts subject to exclusive rights and the common parts. They also govern the rights and obligations of condominium owners as well as the responsibilities and process flows in the association. These rules contain, for instance, requirements for resolutions, voting rights, and objectives, and they determine the cost allocation for maintenance and refurbishment as well as the implementation of the refurbishment plan.
What are the operating costs for condominiums?
Before buying a condominium, you should find out how much the ancillary costs are. As a co-owner of a property, your ability to influence or optimize these costs is limited, however. The best thing to do is to ask to see the utility bills from previous years before buying. Heating costs in particular are a major factor here. These can vary based on the quality of the insulation and the type of heating.
Together with the other condominium owners, you also have to pay the salary of the caretaker, the elevator service, container fees, and other additional costs. Joint costs are generally based on the proportional value held by the individual owners. In other words, the larger their value ratio in the entire property, the more they will have to pay.
Condominium refurbishment fund
The refurbishment fund is a means for financing maintenance work and refurbishment measures for common parts of the property. All the condominium owners periodically contribute a set amount to the fund for this. A well-stocked fund can prevent individual condominium owners from having any unpleasant financial surprises. For instance, if energy-related renovations are required. Before buying a condominium, it may be worthwhile to see how much money is in the fund and whether any new renovation work is scheduled in the refurbishment plan.
Condominium management
The manager serves as a point of contact for any questions and concerns that condominium owners have. They are responsible for the technical management of the property, ensure implementation of the refurbishment and financing plan, and keep track of the renovation fund. Another task of the manager is to send informational documents to the association members in a timely manner. In the case of newbuilds, the condominium association is often responsible for choosing a competent property manager and detailing their list of duties more precisely in a specification document. For larger projects, joint management is often defined for the first few years, but can be re-assigned after a certain period at the condominium owners' request. The criteria for selecting a manager may include experience, the type of training and development in administrative management, and expertise in technical management. The interpersonal skills of those involved in the management should not be overlooked either.
If a new management organization is selected, the mandate can be withdrawn from the current property manager by a majority resolution of the condominium association. A meeting of the association is required to make such a change. By law, a meeting must be convened by the current manager if at least one-fifth of the owners demand such a meeting. However, the manager also has the right to terminate the mandate.
Condominium association meetings
Living in a condominium also means being part of a community. Owners regularly meet at association meetings to make important decisions together. This applies to all collective management matters that have not been delegated to the manager or to a committee, for example. Decisions can include the color of the facade, appointment of a new manager, or approving the budget. For those buying a unit, it's good to know what the tone is like at the association meeting. The manager is responsible for organizing the annual association meetings.
Avoiding conflicts in commonhold properties
Decisions on the management of commonhold properties are always made by multiple parties. This can result in misunderstandings. The manager plays an important role in the communication between the individual condominium owners. Clear condominium rules and transparent actions on the part of the manager can be key to successfully avoiding conflict. After all, living in harmony with one another requires a certain degree of mutual tolerance. A culture of frank discussion contributes to this.
