Developed almost 60 years ago, Strata Title is an Australian creation which is now used by countries all around the world. In NSW, the NSW Conveyancing (Strata Titles) Act came into effect on 1 July 1961 and now covers over 270,000 schemes and accounts for over 50% of residential leases and sales in Sydney alone.
Previously many strata properties were bought under a “company title”, which meant that owners didn’t actually own a title to the property but rather a share in the company that owned the title. This made it difficult for property buyers to obtain loans from banks and also meant that the company owners did not have to obtain the permission of shareholders for big decisions.
What is strata title?
Strata title is a type of ownership structure. When you purchase an apartment, townhouse or other strata property, you’re purchasing part of a strata title. Unlike previous company titles, this means that you have individual ownership of your property (also called a “lot”) as well as shared ownership in part of the building and common areas. These common areas can include a range of things such as driveways, foyers, lobbies, car parks, lifts and gardens, as well as recreational facilities like fitness centers and swimming pools.
Under a strata title, you are responsible for the upkeep and maintenance for your personal lot, as well as sharing responsibility with other lot owners for the upkeep of common areas. Because dealing with shared areas can often become confusing with multiple parties involved, common property is generally managed by Body Corporate (also known as the Owners Corporation).
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What are the rights and responsibilities of a lot owner?
Under strata title, the owner of a lot has certain rights and responsibilities. For example, all lot owners have the right to live peacefully in their own home. Similarly, it means they have the responsibility to respect all by-laws and act in a manner which is respectful and courteous. Lot owners will also have other requirements such as:
- Obtaining contents insurance for the lot
- Abiding by all by-laws laid out by the Body Corporate
- Attending all general meetings or nominating a proxy if they cannot attend
- Informing the Body Corporate if there is a change in ownership or tenants
- Paying all levies in a timely manner and in accordance with the schedule
What are the rights and responsibilities of Body Corporate?
The Body Corporate (or Owners Corporation) is responsible for managing and maintaining the common areas of a strata property. Their responsibilities will also include items such as:
- Adhering to the rules and regulations stipulated under the legislation of the specific state or territory
- Taking care of all finances, funds and administrative tasks associated with the strata
- Maintaining insurance for the building
- Maintaining and repairing all common areas without inconveniencing individual lot owners
- Keeping clear records of all documents including financial records, minute meetings, register of committee members and lot owners and budget costs
- Resolving any disputes or issues between lot owners in accordance with the by-laws
Are you considering purchasing a strata property? Get in touch with our team today for more information on our range of body corporate services or explore our document bank for more information.
