Recently, a Houzy user sent an email to the Houzy magazine editors in response to our article "Proper Ventilation Improves the Climate and Prevents Mould". He is a condominium owner and believes that the other co-owners are heating unreasonably and that he is therefore paying too much for heating. His question as to whether he could do something about it prompted us to write this article about the fair distribution of costs in condominiums. The topic should interest even more condominium owners or people who are considering buying a condominium soon.
In condominium ownership, all condominium owners bear the costs for their condominium unit themselves. The individual consumption must be measured and the heating, electricity and water costs must be charged according to consumption: Each person only pays for what he or she has consumed, regardless of the co-owners. This is fair and simple in newer buildings, because a meter measures the consumption for each floor unit. For condominiums in older buildings without meters, the consumption and thus the costs are distributed according to a fixed key, usually according to the value ratio. Then it can happen that someone pays comparatively more heating costs than the co-owners, even though he or she has heated less. As in the example of our user.
The value quota is the costs distribution key for all common costs. For example, for the maintenance, repair or renovation of common parts or the operation of common facilities such as lifts or heating - and for the distribution of water, electricity and heating costs in a house without a meter. The value quota is defined in thousandths as soon as condominium ownership is established and entered in the land register. It depends on the size of the rooms in the special right and the ancillary rooms such as the cellar or laundry room, as well as the area of the parts with exclusive rights of use such as a car parking space or garden share. It can be weighted and refined by factors such as view, sunlight or floor height and is usually valid until the end of the condominium ownership.
According to Article 712e of the Swiss Civil Code, a change in the value quota is possible if all parties directly involved agree and the condominium owners' meeting approves the change. The greatest chance is if the quota was set incorrectly by mistake or has become incorrect as a result of structural changes to the building or its surroundings. If the other co-owners agree, the agreement must be publicly certified. The possibilities to enforce the change with a lawsuit against the will of the other condominium owners are very limited.
All water, electricity and heating costs as well as repair or renovation costs of common components are settled according to the distribution key, usually according to the value quota. What is considered common is determined by each community itself when it establishes condominium ownership. The law defines these components as common:
The value quota is never 100 per cent fair. The co-owner on the ground floor never needs the lift, but he often has guests who park in the shared visitors' area. The co-owner on the third floor uses the lift several times a day, but her guests come by public transport or visit her on foot. This usually balances out. That is why the fixed distribution key is not always fair, but it is suitable for everyday use and pragmatic. The condominium regulations can provide for exceptions to the distribution of costs according to value. This makes sense for radio and television reception fees (Serafe), for example. Such decisions require a majority of the condominium owners, amendments to the regulations require a qualified majority (more than half of the votes and value quotas).
Condominium owners should put money aside at an early stage for major expenses such as repairs or renovations to common components. After about 25 years, the first major renovations are due, for example the complete renovation of the roof, the façade, the building envelope or the building services. 80 per cent of condominium owners' associations in Switzerland have set up a so-called renewal fund for this purpose, although the law does not prescribe one. Read our article "Renovation Funds in Condominium Ownership: All You Need to Know".
Most condominium owners' associations set aside 0.2 to 0.5 per cent of the building insurance value of their property per year; the Swiss Condominium Owners' Association recommends 0.3 per cent. The amount of the deposits is usually based on the value ratio. The earlier a condominium owners' association starts making deposits, the lower the financial burden per year. So it is best to start when condominium ownership is established. All deposits are considered maintenance costs and can be deducted from the imputed rental value and thus from the taxable income.