3. The Homeowner’s Association: beware of ‘sleeping’ Homeowner’s Associations!
The Homeowner’s Association is legally established as soon as a notarial division deed is signed. All ‘apartment owners’ will then join the Association. These owners will be joint owners of the entire property. The Homeowner’s Association not only exists on paper. The Association itself (name, address, establishment date) and its board must be registered in the Trade Register.
To avoid any unwanted surprises, it is important to regularly meet with the owners to discuss several common concerns. We talk of an ‘active association’ if:
- members gather at least once a year
- the association has a chairman and director
- a collective home insurance has been taken out
- the Homeowner’s Association is registered at the Chamber of Commerce. This is a legal requirement. Only if the property was divided before 1972 is registration at the Chamber of Commerce not required.
- a bank account has been set up in the name of the Association
- members pay a monthly fee (service fee)
- a long-term maintenance plan (MJOP = meerjarenonderhoudsplan) has been arranged. Please note: if there is no maintenance plan, an architectural report must be submitted that demonstrates the condition of the property, or it should be made clear that this report is unnecessary.
Take a look at the accumulated reserve fund and what it should be used for. Associations are required to have a reserve fund. From this fund, the Association pays non-annual expenses, such as major repairs. A large reserve provides a lower risk of shortages. The reserve fund must be healthy enough in relation to the long-term maintenance plan.
In the event of a considerable lack of maintenance, the municipality can invite all Association members for a meeting. It can also force an Association to set up and execute a maintenance plan.