Is Your Building Unhealthy?

We recently attended the CHU Insights25 seminar, where one of the standout conversations centered on the concept of building health. Industry experts unpacked what defines a healthy building versus an unhealthy one, and how the strata industry can help bridge the gap.

Signs of an Unhealthy Building

An unhealthy building often shows signs of neglect, not just in its physical condition, but in its governance and financial planning. Here are some common indicators:

• Disengaged Ownership: The body corporate struggles to reach a quorum at meetings, and the few owners who do attend are often disgruntled or disconnected.
• Underfunded Maintenance: Minimal levies are set, leaving no room for preventive or routine maintenance. Over time, this leads to visible deterioration.
• Reactive Insurance Use: Insurance becomes a tool to fix problems that could have been avoided with prior proactive maintenance.
• Higher Premiums: Maintenance issues and a poor claims history result in increased insurance costs.
• Declining Asset Value: As the building’s condition worsens and internal unrest grows, its market value drops compared to healthier buildings in the area.

What a Healthy Building Looks Like

In contrast, a healthy building is a well-managed, financially sound community that prioritises long-term resilience. Some key characteristics include:

• Engaged Community: The body corporate operates as a proactive community, using sound risk management practices and regular maintenance schedules.
• Strong Financial Planning: Adequate sinking funds are maintained, ensuring resources are available to address issues before they escalate.
• Lower Insurance Costs: Good risk management leads to fewer claims and lower premiums, freeing up funds for improvements.
• Insurance as a Safety Net: Coverage is reserved for true emergencies, not routine fixes.
• Rising Market Value: These buildings often outperform their peers in terms of asset appreciation, attracting buyers and investors alike.

Better Building Health Starts Now

The strata industry has a vital role to play in helping buildings transition from unhealthy to healthy. With commitment, time, and the right financial investment, any building can improve, not just in condition, but in community spirit and market value.

With the right guidance and commitment, every building has the potential to become a valuable, well-maintained asset that benefits all stakeholders.