Your Guide To Strata Levies
Every strata scheme has certain fees and levies that all owners have to pay. These are set at the Annual General Meeting and agreed upon by the owners corporation, giving each owner an active part in deciding on how much they should pay in strata fees each year. The strata fees are influenced by many different factors, including the size of the strata scheme, the age and condition of the building, and the facilities provided in the scheme.
What is the difference between strata fees and strata levies and what are they used for?
Strata fees and strata levies are simply two different names for the same thing. They refer to the mandatory fees that each member of the owners corporation has to pay – usually in quarterly instalments.
There are three types of strata fees: administrative fund levies, capital works fund levies and special levies. The administrative fund covers running and daily maintenance of common property, including things like employing a cleaner, plumbers, electricians and taking out insurance. The capital works fund, formerly called the sinking fund, is for larger and more long-term repairs and updates, such as replacing elevators or repairing storm damage. Finally, special levies cover any unexpected or especially expensive work not covered by the capital works fund.
All of these fees ultimately help keeping your property safe, up-to-date and well-maintained, ensuring your quality of life while you live there and its attractiveness for potential tenants and future buyers.
What are strata management fees and what benefits are there in getting a strata manager?
Strata management fees are incurred by employing an external strata manager. These rates and fees are structured differently from company to company. Most will charge a base monthly fee which covers a set number of services that they will provide.
While having a strata manager comes with an additional fee, effective strata management can make the difference between a messy, disorganised scheme with stressed out owners and a successful, smoothly running one. What’s more, a strata manager can also end up saving a strata scheme thousands of dollars through insightful financial advising and giving you invaluable advice on how to run your strata scheme effectively. Mismanaged strata schemes often charge higher levies due to wastage, overlooking legal requirements and the ensuing legal fees, and mismanagement of complaints leading to lengthy mediation processes.
Overall, the fees that you pay in a strata scheme, be it for maintenance, repair works, updates or strata management, will all ensure the quality of life in your property now and in the future. A well-managed strata property is less likely to lose value and is more attractive to future tenants and buyers, so find out more about our strata management services today.