When do you tell your body corporate you are selling?
Conventional wisdom in the management industry is not to tell your body corporate you are selling until your contract is unconditional. This is put forward for a number of reasons, which includes:
- if the sale falls over, the committee might regard you differently in terms of work ethic, supervision etc;
- there could be costs incurred which are payable whether the sale proceeds or not; and
- there is no point upsetting the apple cart if the sale does not proceed.
We do not necessarily subscribe to this approach. We do not think there is a ‘one size fits all’ approach to dealing with bodies corporate. Each committee has a different personality and it is really up to each resident manager to decide what is best for their particular circumstances.
From our end, we have seen some clients take their committee into their confidence when they list to sell. This makes some of the committee members at least feel informed about what is going on, which can ease the assignment process through when a contract subsequently arrives.
It also removes the risk of the committee feeling ‘ambushed’ with the request to consider an assignment, especially when that request is delivered a month or more after a contract is signed and especially where the proposed settlement date is 30 days or less away.
So while we do not advocate telling your committee the moment you are considering selling, there are certainly circumstances which will exist which mean bringing the committee into your confidence will better serve your interests.