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Common Property

Updated on April 11, 2024
Article byGayatri Ailani
Edited byGayatri Ailani
Reviewed byDheeraj Vaidya, CFA, FRM

What Is A Common Property?

Common Property is defined as property collectively owned by multiple entities, where they share the right to use it, in addition to being equally responsible for its maintenance. The purpose of common property is shared ownership, limiting the exclusive control any single party has over the property.

Common Property

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Compared to sole ownership, this arrangement offers reduced individual decision-making control to parties. Its importance lies in its ability to facilitate shared access and use of resources, promote collaboration and cooperation among multiple parties, and support the sustainable management of resources for the benefit of all stakeholders involved.

Key Takeaways

  • Common property refers to jointly owned areas or amenities within a community or strata corporation, accessible to all members for shared use, with maintenance and management typically overseen by the collective ownership entity.
  • It is collectively owned and shared by all owners in a strata corporation, while limited common property is specific areas designated for exclusive use by certain units within the corporation.
  • It is collectively owned and shared by multiple owners within a community, with shared access and management. Private property is individually owned, providing exclusive rights to the owner for use, control, and disposal without shared ownership or access.

Common Property Explained

Common property includes all the areas within a strata building and its surrounding land that are not specifically designated as part of any individual owner’s lot. These shared spaces typically include common areas such as hallways, stairwells, elevators, lobbies, driveways, and recreational facilities used collectively by all residents or owners within the property complex. The ownership of common property is jointly held by all owners within the strata scheme, and its management and upkeep are typically overseen by a body corporate or homeowners’ association.

One of the key aspects of common property is that it serves as essential infrastructure for the functioning and accessibility of the entire property complex. Residents rely on these shared spaces for everyday activities such as accessing their units, moving between different parts of the building, and enjoying communal amenities. Additionally, it plays a crucial role in fostering a sense of community and shared responsibility among residents, as they collectively contribute to its maintenance and improvement through the body corporate or homeowners’ association.

Effective management of common property is essential for ensuring the well-being and satisfaction of all residents within the property complex. This involves establishing clear guidelines and regulations for the use of common areas, maintaining the physical condition of these spaces to a high standard, and implementing fair and transparent decision-making processes regarding any changes or developments affecting common property.

Common spaces, resources, or land may exist in several forms. For instance, water may be made available for common use to a community or group. Similarly, several entities might have access to a garden area under a common arrangement. They may even be distinguishable based on who builds them and for what purpose. For example, public parks are open to everyone, with government bodies or other relevant authorities managing the affairs of the park.

Characteristics

Since common property may exist in varied forms, it is important to understand its primary features. Some of its defining characteristics are listed below.

  1. Non-excludable: This means that it is difficult or impractical to prevent people from using or accessing the resource. In other words, individuals cannot be easily excluded from using the resource even if they have not contributed to its upkeep or maintenance. For example, it is challenging to stop someone from fishing in the ocean because the ocean is vast and open, making it hard to enforce exclusive rights to fishing areas.
  2. Rivalry: This refers to the fact that the consumption or use of a resource by one individual reduces its availability to others. In simple terms, when one person uses or consumes the resource, it diminishes the amount available for others to use. In the case of fisheries, when a fish is caught by one fisherman, it is no longer available for other fishermen to catch. This rivalry can lead to competition and conflicts among users, especially when the resource is limited or declining.
  3. Shared Responsibility: As the name suggests, these spaces, resources, or facilities are not exclusive to a single entity; they are available to multiple entities for common use. It also means that the maintenance of such property is everybody’s responsibility.
  4. Access Restrictions: In some cases, only certain users or entities may be given access to spaces or resources. For example, clubhouses typically only allow members to use their resources and amenities. Hence, in such cases, access is not entirely restricted, but it is not open to everyone either.
  5. Usage Guidelines: Most common facilities, amenities, and buildings require users or members to follow the defined guidelines. Non-compliance may even be fined in some cases.

It is important to understand that these characteristics or features may change from one property to another, depending on the intent of building it, usage rules, and maintenance requirements. Also, the idea of what defines such property may evolve with time, based on social, economic, or other changes.

Examples

Here are some examples to help readers understand the concept better.

Example #1

Suppose Rising Glory is a gated community with biogas plants installed to generate electricity for all the buildings within this complex. The plants are installed across buildings, and their benefits are shared by all the residents. Additionally, all the members get access to common resources, facilities, and amenities.

A committee has been appointed to oversee the building’s works. The maintenance, repairs, and management of these plants fall under the purview of the committee. This committee consists of residents from each wing, and its body changes annually to ensure every resident who enjoys the benefits also shoulders the responsibility of the building’s upkeep. Here are the advantages residents enjoy:

  1. Overall reduction in energy costs, which reduces per-head maintenance costs
  2. Reduced environmental impact, attributable to the efforts made by every member of the building
  3. Generation of oxygen that keeps the air within the gated community fresh
  4. Equitable access to renewable energy benefits

This shows that such property is beneficial to multiple entities who also share equal responsibility. It must be noted that only members of the complex can access the facilities and resources it offers. Hence, the right to use is restricted, limited, or controlled.

Example #2

According to a November 2023 article about common property rules in Connecticut, Homeowners Associations (HOAs) in the state are prohibited by the state authority from rejecting applications for home improvement or repairs, provided such changes do not inconvenience any other unit or member.

This decision was made after certain incidents related to solar panel installation came to light, where homeowners wanted to install solar panels exclusively for their property but were asked not to do so by HOAs. As solar panels promote monetary savings, reduced energy consumption, and low environmental impact, many homeowners wish to enjoy these benefits.

By defining the nature of renovation or upgrade, the state aptly showed how matters of common spaces, resources, and facilities can be dealt with in cases where no individual homeowner is harmed or disadvantaged.

Common Property vs Limited Common Property

These terms may sound very similar, but certain distinguishing features highlight the key differences between common and limited common property. These are listed below.

CategoriesCommon PropertyLimited Common Property
DefinitionCommon property is collectively owned by all strata lot owners in the corporation and is available for the use and enjoyment of all residents.Limited common property is a common property that has been specifically designated for the exclusive use of one or more specific strata lots.
Ownership ClaimIndividual owners cannot claim exclusive rights to common property.It means that certain areas or amenities may be assigned to specific units for their exclusive use.
Maintenance ResponsibilityIt is owned collectively by all strata lot owners as tenants in common. The strata corporation has exclusive control over the common property and is responsible for its maintenance, repair, and management.Limited common property is also owned collectively by all strata lot owners but is subject to exclusive use by specific units. The maintenance and repair of limited common property are typically the responsibility of the strata lot owner(s), who have exclusive rights to use it, although there may be exceptions in strata corporations with sections.
ExamplesGardens, roofs, stairwells, etc., in a building are examples of common property. Some other examples include utilities (water, electricity, etc.), shared amenities (laundry rooms, community swimming pools), etc. Balconies, parking spaces, storage lockers, etc., are examples of limited common property.

Common Property vs Private Property

The differences between common property and private property are enumerated in the table below.

CategoriesCommon PropertyPrivate Property
DefinitionCommon property is collectively owned by all owners within a strata corporation or community. Each owner holds a shared interest in the common property, but no individual owner has exclusive ownership rights over it.Private property is owned by an individual or entity, giving them exclusive rights to use, control, and dispose of the property as they see fit.
Ownership ClaimMultiple entities or individuals own these estates, land, amenities, facilities, or resources.A single entity or individual owns such property.
Maintenance ResponsibilityThe maintenance, repair, and management of common property are typically the responsibility of the strata corporation or homeowners’ association.The owner of private property is solely responsible for its maintenance, upkeep, and any associated costs. They have full control over decisions regarding maintenance and improvements.
ExamplesSome examples are gymnasiums in buildings, libraries open to the public, forests in a region, etc.Independent houses, apartments, land, vacation homes, vehicles, etc., are a few examples of private property.

Frequently Asked Questions (FAQs)

1. What kind of conflicts can arise in common property?

As many individuals use the same property, conflicts can crop up in varied forms. These may include unequal access or usage, free usage without paying maintenance charges or fees, unreasonable usage by some leading to rapid deterioration of facilities or depletion of resources, conflict about repairs or renovations, etc.

2. Why should water be considered a common property?

Water should be considered a common property resource because it is a finite resource essential for life and shared by all members of a community. Collective management ensures equitable access, sustainable use, and protection of this vital resource for present and future generations.

3. What is common property in a complex?

In a complex, it refers to collectively owned areas or amenities shared by all residents or owners, such as hallways, elevators, recreational facilities, and building exteriors. Its management and maintenance are typically overseen by a homeowners’ association or body corporate.

4. What is common property in body corporate?

Common property in a body corporate refers to areas or amenities within a residential complex collectively owned by all unit owners, such as stairwells, amenities, etc. The management and upkeep of such property are typically overseen by the body corporate for the benefit of all residents.

This article has been a guide to what is a Common Property. We explain its examples, comparison with limited common property & private property, & characteristics. You may also find some useful articles here –

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