If you’re considering a strata property purchase and are new to the concept of strata schemes, you’ll likely have some questions. What does strata mean, and what is strata management? We cover the essential phrases here for a fast introduction.
What is ‘strata’?
A strata scheme is an Australian concept that’s now used the world over. If you buy a strata title, this means that you own part of a property yourself (typically everything inside the walls of the home) and share ownership of common property with other owners in the strata scheme. Shared property may include corridors, the roof, pathways and gardens.
By paying strata levies (typically every quarter) you contribute to the upkeep of these shared areas. Most apartments, flats, townhouses and duplexes in Australia will be on a strata title.
What are the advantages and disadvantages of owning in a strata scheme?
Strata living can have major advantages. The costs of fixing walls, roofs and other major repairs can be shared with other owners through your levies, which can make strata living a very cost-effective way to own property. Depending on your strata property you may have caretakers or gardeners to keep shared property in its optimal condition – imagine having a pool and never having to clean it!
On the other side, if the strata scheme is poorly managed or maintenance is neglected, these shared costs can potentially become costly.
What is an owners corporation?
An owners corporation consists of the owners within a strata scheme. This group is responsible for the management of the strata scheme including finances, insurance, maintenance, administration and voting on proposed by-laws that provide the rules for living in that strata property. Owners corporations must abide by the Strata Schemes Management Act 2015 in NSW.
What are the different types of strata levies?
Strata levies in NSW consist of an administrative fund for regular costs, and a capital works or sinking fund to cover major and planned repairs. Occasionally the owners corporation may vote on a special levy to cover unexpected costs.
What is strata management and what does it involve?
Strata schemes often employ a strata managing agent to help them manage their meetings and administration. Strata managers are expected to be familiar with the current state strata legislation to help the strata scheme stay compliant, as well as keeping accounts for the property. Depending on instructions from the owners corporation, the strata manager may hold strata meetings, take payments of strata levies and attend to orders, submissions and appeals on behalf of the strata scheme.
Ultimately, the strata manager’s job is to save the owners in a strata scheme time, money and hassles through professional management.
Have questions? The team at Real Property Services would be happy to help.