Condominium ownership under the WEG: what buyers should check on the reserve, operating costs, utility value and owners association and which documents to obtain.
BRANDAUER Rechtsanwälte
Salzburg law firm for real estate, property and corporate law
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Anyone buying a condominium apartment acquires not just four walls but joins an owners association. Together with the apartment you take on running operating costs, a share of the reserve and the binding effect of the resolutions of the association. This side of the apartment is often overlooked at purchase, although it causes considerable cost over the years.
This post explains how condominium ownership under the Austrian WEG 2002 is structured, what role the utility value plays and what to watch for with the maintenance reserve and the operating costs. The focus is on which documents you should obtain before the purchase and how to assess the management situation.
Anyone who reviews the reserve, the latest operating-cost statement and the minutes of the owners association before buying avoids nasty surprises after handover. From a lawyer perspective, much is decided before signing with condominium ownership as well, because the cost situation you take over can no longer be changed later.
Answer one or two questions on documents, the reserve and open contributions. You receive an initial classification of the most important review points.
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Only these documents show how the owners association is organised and which running costs you will face.
Without the condominium ownership agreement and a current operating-cost statement it remains unclear how the owners association is organised and which running cost you will face. Request these documents from the property management before signing. Our checklist on condominium ownership and operating costs offers guidance.
With complete documents the ownership situation can be assessed reliably before you commit.
If the agreement, statement and reserve are known, the ownership situation can be assessed well. Also check the allocation of operating costs by utility value, the resolutions of the recent owners meetings and any usage arrangement. Planned maintenance should be clarified too.
A short legal review of the documents reveals disadvantageous points before you buy.
A low or unclear reserve and possible open contributions of the seller shift costs to you. The owners association can pursue you as the new owner for outstanding contributions. Such points can be clarified before the purchase: proof of the paid contributions, an assessment of the reserve and a look into the minutes.
Have the documents reviewed before signing. A signed purchase contract also binds you to the cost situation you take over.
Condominium ownership under the Austrian WEG 2002 is the right to use and dispose of a specific object such as an apartment or a parking space exclusively. This right is inseparably linked to a minimum share in the whole property. You are therefore at once a co-owner of the property and the condominium owner of your object. Read more in the glossary on condominium ownership.
How large your share is follows from the utility value. The utility value is set in a utility value report and rates each object in relation to the others, for example by size, location and fittings. The co-ownership shares are calculated from the utility values. A deeper explanation is offered by our glossary on the utility value.
The utility value is not just a calculation figure for the share. It usually also determines how the operating costs and the contributions to the reserve are allocated to the individual owners. Check therefore which utility value is assigned to your object. A deeper treatment is found on our focus page on condominium ownership and tenancy rights.
The owners association builds a reserve to provide for future expenses, in particular for the maintenance of the building. All owners pay into this maintenance reserve on an ongoing basis, usually by utility value. The reserve belongs to the association, not to the individual owner, and is not paid out on sale.
For you as a buyer the level of the reserve is decisive. If it is well funded, upcoming maintenance such as a new roof or a facade renovation can be financed from it. If the reserve is low, special contributions or an increase of the monthly charge may threaten after the purchase. Ask the property management for the current level of the reserve and reconcile it with the condition of the building.
Also watch for open contributions of the seller. If the seller has outstanding payments to the association, the owners association can, under the conditions of the WEG, reach the object that now belongs to you. Have it confirmed before the purchase that no open contributions exist. How to secure the purchase contract as a whole is covered in the post on the review of the property purchase contract before signing.
Besides the reserve you bear the running operating and management costs. These include for example the costs for water, sewage, waste, insurance, building care and administration. These costs are usually allocated to the owners by utility value, unless a different agreement exists. An overview of the total costs at purchase is offered by our incidental costs calculator.
The day-to-day administration is handled by the property management. It prepares the annual operating-cost statement and a forecast for the coming year, charges the monthly contributions and implements the resolutions of the owners association. Request the latest operating-cost statement and the current forecast before the purchase so that you can assess the monthly cost realistically.
Important decisions are taken by the owners association by resolution, for example on larger maintenance or the level of the reserve. These resolutions also bind you as the new owner. Read therefore the minutes of the recent owners meetings and watch for measures already resolved. A possible usage arrangement orders the use of common parts such as a garden or parking spaces and may be distinguished from a lease agreement.
These points decide on your running costs and risks. Check each one before you buy.
| Review point | Recommended | Possible risk |
|---|---|---|
| Ownership agreement Complete and current | Reconcile object, share and usage arrangement | A missing agreement conceals the legal situation |
| Utility value Utility value report available | Assignment of the share is verifiable | An unclear utility value distorts the cost allocation |
| Reserve Sufficiently funded | Level fits upcoming maintenance | A low reserve leads to special contributions |
| Operating costs Latest statement and forecast | Allocation by utility value is verifiable | An unclear statement conceals high costs |
| Open contributions Confirmation of the property management | No arrears of the seller | Open contributions burden your object |
The reserve belongs to the owners association and is not paid out on sale. Outstanding contributions of the seller can, under the conditions of the WEG, burden the object that now belongs to you.
Caution with a low reserve: If the maintenance reserve is tight and large maintenance is due, special contributions may threaten after the purchase, which you bear as the new owner. Have the documents reviewed before signing. Booking an initial consultation (72 euro) can quickly bring clarity.
Before buying a condominium apartment you should obtain a bundle of documents. These include the condominium ownership agreement, the utility value report, the latest operating-cost statement and the current forecast as well as the minutes of the recent owners meetings. These documents are usually held by the property management and give a reliable picture of the management.
Additionally request information on the level of the reserve and a confirmation that no open contributions of the seller exist. Clarify whether a usage arrangement exists that, for example, assigns parking spaces or garden shares. This way you recognise which rights and duties you take on with the apartment.
Record the condition of the apartment and the meter readings at handover in a protocol. How such a protocol is structured is covered in the post on the handover protocol for a house or apartment purchase. Structured help is offered by our checklist on condominium ownership and operating costs.
No. The maintenance reserve belongs to the owners association and not to the individual owner. On sale it is not paid out but remains with the association. For you as a buyer it therefore matters whether the reserve is sufficiently funded to cover upcoming maintenance.
The operating costs are usually allocated to the condominium owners by utility value, unless a different agreement exists. The utility value follows from the utility value report and at the same time determines your co-ownership share. The annual operating-cost statement of the property management shows which share falls on your object.
Outstanding contributions of the seller can, under the conditions of the WEG, burden the object that now belongs to you. Have it confirmed before the purchase by the property management that no open contributions exist. This way you avoid having to answer for the arrears of another after handover.
Our focus page on condominium ownership and tenancy rights with the central points.
What condominium ownership under the WEG means and how it links to the minimum share.
How the utility value is determined and why it shapes share and cost allocation.
How to record condition and meter readings at the handover of the apartment.
When buying property, the contract and the land register decide. Call us directly or send an email, callback within one business day.
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