Sinking Fund Forecast

Both NSW and the ACT legislate that an owners corporation must prepare, implement and maintain a 10-year Sinking Fund Forecast.

Surety are experts in preparing such forecasts, for properties large and small, and we do so in line with relevant legal requirements.

We are known for the thoroughness of our Sinking Fund Forecasts—and you can choose from three levels of service.

What is a Sinking Fund Forecast?

A Sinking Fund Forecast evaluates the works and associated maintenance or replacement costs (due to wear and tear) needed for common areas, building elements and property infrastructure. The aim is to keep on top of things so you don’t end up unnecessarily paying for special (and sometimes expensive) levies to cover unforeseen repairs not allocated for.

As its name implies, the fund is a forecast only. However, it’s still an important report that an owners corporation should take seriously and be able to depend on for important decisions. So there’s little point in having a ‘fast and dirty’ report completed that is lacking in detail or is incomplete or untrustworthy.

Surety is highly regarded within the property and inspection industry for the quality and thoroughness of its Sinking Fund Forecasts:

• We are members of the Master Builders Association and the Housing Industry Association.
• We are the only firm of our type in the ACT and Batemans Bay regions that has a building consultant accredited with the Master Builders Association. 

What do you need included in your Sinking Fund Forecast?

This varies depending on the class of the units in your complex. Here are examples of elements that could be included in a Sinking Fund Forecast:

Class A Unit complexes

Fences, pools, spas, tennis courts, driveways, garden structures and open space, service areas and rooms, roofing, car park areas and associated facilities, and the building fabric including windows, doors, walls, balustrades and stairwells.

Class B Unit complexes

Fences, driveways, garden structures and open space, service areas and rooms, car park areas and associated facilities. 

How often should a Sinking Fund Forecast be reviewed?

Surety recommends every two to four years to ensure your fund remains relevant and up-to-date—and to prevent you from paying unnecessary special levies. We can also handle updates or amendments if required.

Does a Sinking Fund Forecast include items that fall under the Administration Fund?

Not unless specially required. A Sinking Fund Forecast is not all encompassing and does not therefore deal with the building from every aspect. It does not, for example, regularly include the elements managed under an Administration Fund such as swimming pool cleaning, lawn mowing and other annual or regular maintenance or replacement requirements.
By arrangement, however, Surety can cost these additional elements and include them in your Sinking Fund Forecast (Option 2 and Option 3 see below).

Levels of service for Sinking Fund Forecasts

Surety offers three levels of service:

Option 1

• A 10-year forecast of works and associated expenditures to maintain and replace common area building elements and associated property infrastructure for either Class A Unit complexes or Class B Unit complexes.
• Ideal for complexes with relatively minor variations in surfaces and fabrics of the building where there may be economies of scale savings by treating all surfaces and fabrics the same way, at the same time. This report combines similar aspects of the building fabric—it does not separate varying maintenance requirements.
• Significant defects observed at the property that are outside the scope of a Sinking Fund Forecast will still be identified in it, to make the owners corporation aware of their existence.

This option does not automatically include an assessment of lifts and pool operating equipment such as pumps. These can be provided for an additional fee, based on a quote we will provide before work begins.

Option 2

Combines everything in Option 1, as well as a detailed maintenance schedule tailored to the needs of your complex.

• Ideal for larger complexes with a wider range of materials and relative exposure characteristics, where considerable savings can be made by staggering maintenance work to match the wear and tear on surfaces. Specifies separate areas of the building fabric and systems requiring different maintenance as a result of their inherent wear characteristics.
• Provides the owners corporation with sufficient detail to confidently organise trade quotes. Specifies materials to use for the works required, enabling owners corporation members to easily organise maintenance without depending on trades people to determine what is required.
• Provides details of existing maintenance contracts (for example, regarding lift or fire service maintenance) and incorporates these costs into sinking fund estimates for a complete picture of maintenance needs and other building costs.
• Can include other funds required for capital upgrades desired (such as replacing a swimming pool). 

Option 3

• Combines everything in Option 2, as well as a detailed analysis of current maintenance products and an in-depth assessment of selected aspects of the building fabric and infrastructure.
• Analyses—where existing aspects of the building fabric is high maintenance—how to reduce maintenance issues through alternative maintenance arrangements or replacement. Also includes an assessment of the long-term cost benefits of these changes. This can include staggering low maintenance products to spread the cost burden to unit owners while still remaining within budget constraints.
• Representation at two owners corporation meetings to provide expert advice, if requested. 

Professionalism you can count on

Surety is a member of the Master Builders Association and the Housing Industry Association. We’re fully insured (including professional indemnity insurance).

Our inspectors are trained and experienced in all aspects of the industry and will give you the best possible advice.  

To view our sample report for Option 1

Questions or place an order?

To organise your sinking fund forecast, simply complete the order form and receive a online booking discount. We will contact you within 24 hours or during the next business day

To have your questions answered, simply complete this short contact form and well contact you within 24 hours or during the next business day