The 2014 Allur law upset some real estate rules, especially regarding condominium work. Article 14-2 of the law 65-557 of the 10/07/1965 was modified by the law Alur 2014-366 of the 24/03/2014. Clearly, from 1 January 2017, it will be mandatory for some condominiums to build a work fund. Are you concerned by this law? Answer below...
Which condominiums are involved?
Paying a building fund in a condominium is an obligation that applies to all apartment buildings, with the exception of three cases that fall outside this rule:
1- Condominiums with less than ten lots may refuse to constitute a work fund by a unanimous vote at the general meeting
2- New buildings under 5 years old
3- If the technical diagnosis of the co-ownership is good and if the building does not require work in the next 10 years
If the condominium does not meet these three exception criteria, the work funds are then mandatory for condominiums in 2017. This contribution is annual, it will be called each year.
The trustee of co-ownership must include this obligation on the agenda of the general meeting. The work funds will have to be called at the same time as the calls for funds of current expenses as of January 1, 2017.
2017 Work Fund: the terms and conditions
The purpose of this savings fund is Anticipate funding for future urgent work to be done quickly as part of the safeguarding of the building. This fund will be funded by a mandatory annual fee for all co-owners. The amount called each year can not be less than 5% of the estimated budget of the condominium. The amount will be distributed according to the directors of each co-owner.
For example, if all annual charges are 60,000 euros, the amount of work funds will be 3,000 euros minimum to be divided between each co-owner according to their share.
The funds are placed in a separate account and established in the name of the syndicate of co-owners. The money will be used to pay for the work, excluding current maintenance costs.
When the property is sold, the owner will not be able to recover his share. Indeed, this works fund is allocated to the lot and not to the co-owner. It is therefore not not possible to recover the amount paid upon departure of the co-owner.