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What happens to the reserve fund upon sale
What happens to the reserve fund upon sale?
When selling an apartment, the question often arises: do I get my contribution to the reserve fund back? The short answer is: no. The reserve fund remains linked to the apartment and not to the person of the seller.
What exactly is the reserve fund?
The reserve fund is a savings pot of the Owners Association. It is built up to finance future major costs, such as:
- Roof renovation
- Facade works
- Elevator modernization
- Renewal of piping
- Major structural repairs
Each co-owner periodically pays a contribution according to their share in the common areas.
Do you get your share of the reserve fund back upon sale?
No. Upon sale, the accumulated amount remains in the reserve fund and automatically transfers to the buyer along with the apartment.
The reserve fund is not an individual account, but a collective fund linked to the building.
Why do you not get that money back?
The reserve fund is legally linked to the private lot (the apartment). Whoever is the owner contributes. Whoever sells transfers their share in the fund to the new owner.
It is therefore different from a personal savings account. You are not only selling the apartment, but also the associated share in the common reserves.
Is the reserve fund included in the sale price?
In practice, the market value of the apartment often takes the financial condition of the building into account. A well-funded reserve fund can even be positive for the sale price, as future works are better financed.
However, there is no automatic reimbursement or separate financial settlement of the reserve fund at the notary.
What should the buyer know about the reserve fund?
Upon sale, the Property Manager provides the notary with information regarding:
- The status of the reserve fund
- The financial situation of the co-ownership
- Any planned works
This way, the buyer knows how many resources are available for future investments.
What is the conclusion?
When selling an apartment, you do not receive your contribution to the reserve fund back. The fund remains linked to the apartment and automatically transfers to the buyer. The reserve fund is the collective property of the co-ownership and not the personal savings of the seller.
What you put into the reserve fund stays in the building
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