• Carrie McInerney

What you need to know before buying in Strata

Each year more Australians are buying into Strata but it’s not always straightforward.
Man and woman looking out of apartment building. Things to know before buying into strata, community or body corporate complexes

It's becoming more and more common for people to live or invest in a Strata or Community Title property. Nearly two and a half million Australians live in an apartment, a number that's rising, and it's easy to understand why. Apartments and townhouses are often closer to the city, more affordable, and require less maintenance.


Even though the growth of strata and community titles is surging, it's important to keep a few things in mind when buying into a scheme - it's essential to do your due diligence.


Research, research, research:

You've found the unit of your dreams; now the work begins. When contemplating your purchase in Strata, it is vital that you do your research first.

Woman on laptop looking into distance. Thoroughly research the unit or apartment you plan to buy to ensure it is right to you and that you can afford all of the associated costs.

Call your agent


A good real estate agent can arm you with the basics, so they should be your first port of call. Agents are required to provide a Section 41, or Section 139 for Community Titles, to prospective purchasers - a collection of search documents that relate to the property. These documents will include insurance details outlining the level of cover the Corporation has, the last two Annual General Meeting minutes, Committee meeting minutes and the Corporation's financial records. Once you have these, you must read them thoroughly, looking for any details that cause concern or need clarification.


Can you keep up with costs?


It is important you note the current levy contributions of the Strata or Community group you're buying into and consider if you can afford this quarterly, non-negotiable expense. This compulsory fee may change, possibly increasing, subject to future considerations of the Corporation, for instance, planned future maintenance or an anticipated increase in insurance premiums.

Laptop with financial records on screen. Review AGM Minutes and the financials of the Corporation where you are buying a unit or apartment.

Forecasted spending


Review the AGM minutes to understand if there are any proposed, or already committed, large scale maintenance items that may require a Special Levy and determine if you will have future funds available for this.


Reviewing past financials and proposed budgets is also a good idea as it will help you understand if the group

is proactive about maintenance jobs when they are first raised and if there are regular expenses suggestive of underlying issues that may need attention in the future. Minor plumbing repairs, for instance, could be proactive maintenance or a symptom of ongoing repairs in order to put off major repairs that are required.


Checking these documents will give you confidence that you're buying into a group that looks after their asset and budgets for future expenditures rather than raising levies every time work is required.


What do the by-laws say?


When reviewing the strata group documents, check out the by-laws of the Corporation. By-laws will vary from group to group, so don't assume they will be the same as your friend's strata group or where you last rented. If you plan to ask for alterations to the by-laws, it may be best to either seek approval for your preferred changes before you sign the contract for the unit or negotiate signing subject to the approval of your request. Look to see what sort of requests have been approved or denied; past applications for pets or pergolas will give you an idea if the Corporation is willing to consider requests or regularly votes against them.


Professional woman talking to a couple. Horner Management's experienced strata managers can offer advice and insight into buying in strata.

Who's your Manager?


Find out which Strata Management company represents your prospective group and their track record. Have they managed your group for a long time? What is their track record? Are they reputable, and are they known as good communicators?


Pets in Strata


One of the disadvantages of owning in Strata is the default ruling that a person

bound by the Articles of the Strata Titles Act cannot keep any animal in or in the vicinity of a unit without the Strata Corporation's consent. Unless your Corporation has previously agreed by way of Special Resolution that a blanket approval is granted for the housing of a pet, an owner must make an individual application to the Corporation for pet approval. The pet request is facilitated through an Ordinary Resolution vote, whereby a majority of owners must be in favour in order for the motion to pass. If you wish to seek approval to house a pet, you can request your Strata Manager undertake an online vote or that it is added to the agenda for your next Annual General Meeting.


In order to achieve a positive outcome, we've found that the more information you can provide Corporation owners, the better. We recommend highlighting where the pet will be housed - will it be indoors at night and outside during the day? Will the pet be left alone while you're at work? You should let the other owners know that you do not intend for the pet to roam the Common

French bulldog. When purchasing a unit, apartment or townhouse in a strata, body corporate or community group it is essential to ensure you can have a pet. If you have a dog or cat you need to make sure you can bring it with you.

property. Providing owners with your pet's particulars, such as breed, age, and temperament, is also a good idea. Owners may be reluctant to vote in favour of your application if they think you are bringing in a large German Shepard to a small unit with no yard but may consider a smaller breed for the complex. Photos and letting everyone know the pet's name is an excellent way to familiarise them with your furry family member.


Brainstorm all the things your neighbours might want to know about your pet - every little detail can help you move forward with your application.


In accordance with the Equal Opportunity Act, you don't need to seek approval for an assistance dog or therapeutic animal. However, you may be asked to show that the dog is an accredited Guide Dog under the Dog and Cat Management Act or that it has been certified by a medical practitioner as being required to assist a person.


If you own in a Community Title, the Corporation will have specific by-laws that may outline the rules for housing pets. In some cases, the by-laws can state that residents may have one or two animals, and in some cases, they stipulate the size or weight of the animal. The Community Titles Act does not mention animals, so if there is no mention of animals in your by-laws, you do not need to seek approval.


Ultimately, you want to reassure your neighbours that their "quiet enjoyment" will not be affected by you having a pet.


Strata Unit Contact Details

Typewriter with the word contact written on paper. Under Schedule 3 of the Articles of the Association of the Strata Titles Act 1988 part 12 states that "a unit holder must immediately notify the strata corporation of (a) any change in the ownership of the unit or any change in the address of an owner; (b) any change in the occupancy of the unit.

Under Schedule 3 of the Articles of the Association of the Strata Titles Act 1988 - yup, it's a mouthful - part 12 states that "a unit holder must immediately notify the strata corporation of (a) any change in the ownership of the unit or any change in the address of an owner; (b) any change in the occupancy of the unit.


In other words, an owner is obligated to advise the Strata Corporation of any sale or change in ownership, and owners must ensure they provide up-to-date contact details.


Under the Community Titles Act, Section 135, it is stated that a register of owners must be maintained, including the names of the owners of the community lots, their contact addresses, telephone numbers and email addresses. However, an owner is not obligated to provide tenant contact details as matters relating to the Corporation are

communicated to and through the owner, and an owner can then choose to advise the agent and tenant.


The requirement to provide up-to-date contact details is a benefit to all owners in a corporation, as this assists in the successful management of levies, maintenance and communication. You might miss receiving essential documents, invoices, notifications of contractors attending, and voting forms by not providing this information.


Get to know your neighbours. Woman shaking hands with someone over coffee. Strata living is on the rise - make sure to purchase in the right community for you.

Horner Management always provides a "contact details form" when issuing Annual General Meeting notices to ensure we have your correct information.


Strata living is growing in popularity and can be a wonderful experience, especially if you get off to a good start. The best start to that experience is understanding your asset and how the Corporation you are buying into works. All Corporations are different; some groups love the structure of the Strata Titles Act and do not want to make changes from the original development, whereas others are happy to move forward with the future wants and needs of the community. As you will be living in close proximity to those around you, it is vital that you buy into a Community that suits you.



Want to know more about living in Strata? Check out our other articles below


 

Horner Management is a multi-award-winning strata management company based in Adelaide and covering Body Corporate, Community and Strata Title plus Property Management.



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