Ageing condos • Well-managed sinking funds fulfil critical role

Sinking funds are key financial safeguards for Singapore's strata-titled properties, ensuring long-term structural sustainability and value preservation (Some ageing condos in Singapore struggle with failing infrastructure, inadequate sinking funds, Aug 7).

- Dennis Tan President MCST Association of Singapore

The Building Maintenance and Strata Management Act (BMSMA) mandates that all management corporations (MCSTs) must establish and maintain sinking funds for major repairs and budget for long-term sustainability. These funds are legally segregated from management funds used for regular maintenance and cannot be used without the approval of a general meeting.

Sinking funds cover capital expenditures beyond routine maintenance, including lift replacements and major upgrades, structural repairs and mandatory seven-year cyclical repairs and repainting programmes, replacement of electrical systems, sanitary/plumbing systems and waterproofing.

By funding cyclical maintenance, sinking funds prevent the deterioration seen in ageing condos, thereby protecting owners' asset values in a sustainable manner.