Are Strata Laws Different in a Duplex?

admin | Posted on Wednesday, August 15th, 2018

A duplex or small lot is a great compromise for those who can’t afford to buy a freehold property. Some maintenance costs are shared but you can still maintain a level of privacy that may not be possible in an apartment building.

Many people mistakenly believe that strata laws do not apply to duplexes or small lots. This is not the case. There are however some differences between the management of small strata schemes and the those that you would find in regular apartment buildings. So what are the main differences and things you should be aware of before buying a duplex?

 

Most State Strata Laws Still Apply

Yes, there are some differences and advantages to strata management in a small lot such as a duplex but this doesn’t mean that most of the same rules don’t apply. Owners must still meet all safety, maintenance and administration requirements as well as keep adequate financial records.

 

Fund Exemptions

According to the Strata Schemes Management Act 2015, owners corporations must establish a capital works fund made from payments by each unit owner. The Capital Works Fund, also known as a Sinking Fund, is for any major maintenance required in the building or common areas.

In accordance with Part 5 of the Strata Schemes Management Act 2015, an owners corporation for a strata scheme comprising of two lots (a duplex) does not need to establish a capital works fund providing that:

(a)  the owners corporation so determines by unanimous resolution, and

(b)  the buildings comprised in one of those lots are physically detached from the buildings comprised in the other lot, and

(c)  no building or part of a building in the strata scheme is situated outside those lots.

 

Responsibility For Insurance

Under Part 9 of the Act, the owners corporation must insure the building under an insurance contract that insures the building against destruction, damage by fire, lightning, explosion or any other occurrence specified in the damage policy.

Two lot strata schemes can be exempt to this if:

(a)  the owners corporation so determines by unanimous resolution, and

(b)  the buildings comprised in one of those lots are physically detached from the buildings comprised in the other lot, and

(c)  no building or part of a building in the strata scheme is situated outside those lots.

 

Strata Committee

According to the Part 3 of the Act, the owners corporation must select a strata committee. In most buildings, this would consist of a number of people determined by the owners corporation but must not be more than nine. In large strata schemes, the strata committee must have at least three members.

In two lot schemes however the committee must consist of the following:

(a)  the owner of each lot who is a sole owner or the company nominee of a lot if the sole owner is a corporation,

(b)  for each lot that is owned by co-owners, the co-owner nominated by the other co-owners or (if the co-owner nominated is a corporation) the company nominee of that co-owner, or if there is no such nomination, the co-owner first named on the strata roll.

For more information on the strata laws for your building or property, check your strata scheme’s by-laws or ask your strata manager.

CATEGORIES strata laws