Strata Sales and Management

Improving your Strata Complex

2007-03-23T11:04:00.000+08:00

For older buildings, consider updating your complex to improve its appearance & value:

rendering façade of building
renovating foyer area
upgrading landscaping
replacing balcony railings with safer & more modern design

Careful planning is necessary before commencing a large project. With the right advice and correct budget, considerable value can be added to the strata complex, which will be of direct benefit to each of the owners. Not only will they have a more stylish building to live in but the value of the unit will have increased. Obviously, units in buildings with well landscaped areas command a much higher price than units in bland unattractive buildings.

Whether it is carrying out repairs or improving your complex, get the right advice FIRST and reap the dividends.

Maintenance and Repairs

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Defects can develop at any time and as a building ages repairs are needed. Not all quotations are the same. Specifications should first be prepared by appropriate professionals to ensure the correct method of repair is used. It is also important that the problem is diagnosed correctly and the most economical method of repair used. Expert advice is especially needed for major works, which would include:

roof replacement
concrete spalling
facade repairs
window replacement
archbar replacement
waterproofing & rising damp
water penetration
cracking to walls/subsidence
uplifting driveways and concrete areas

Buying Off The Plan

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When purchasing a unit "off the plan", i.e. before the building has been completed, there are a number of things you need to attend to:

Obtain as much information as you can from the real estate marketing company about estimated completion date, specific details of included fixtures & fittings in the unit and those in any recreation areas ie gym room, sauna, etc.
Carefully inspect the display unit
Carefully examine the floor plan making special note of whether it has suitable living areas, balcony areas and room location. Will your furniture fit appropriately in the style of the unit? Does the layout suit your lifestyle?
What are the proposed levies? Is it anticipated they will increase by the time the building is completed?
How much variation in the size of the unit (as shown on the plan compared to the final size) has the vendor nominated in the Contract for Sale? Is this acceptable? E.g. The floor plan may show a total unit area of 110 m2 but the final size is only 98 m2.
Are there any proposed restrictions on the use of facilities?

NOTE: Detailed advice should be obtained from your solicitor before proceeding with a purchase.

Buying a Strata Unit

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Before purchasing a strata title unit, it is wise to arrange an inspection of the books and records of the owners corporation by a suitably qualified strata searcher. There are many things that are not apparent from a visible inspection of the building. There are a number of factors which can impact on you once you become the owner and it is better to be informed about these so that a prudent decision can be made BEFORE purchasing.

Purpose of a strata search

What important items should you consider?

Is the building adequately insured?
Is there a recent building valuation to support amount of insurance
Does the strata scheme have an adequate sinking fund, taking into account the age of the building, the current state of repair, the type of construction
Can I afford the quarterly levies?
Are there any special levies planned?
Are there any outstanding building works, unpaid invoices etc that could result in a special levy?
Is the annual sinking fund allocation adequate?
What are the current balances in the Administrative & Sinking Fund account?
Are there any current or proposed litigation matters involving the owners corporation?
Are there any limitations or restrictions on the use of common property which may affect you?
Are there any outstanding public liability claims involving the owners corporation?
Are animals permitted?
Have any alterations to the unit been approved by the owners corporation, ie installation of air conditioning unit?

Common Property or Not?

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The boundaries between common property and lots are shown on the registered strata plan. For detailed information about boundaries, reference should be made to the SSMA or SSO. A copy of the relevant strata scheme can be obtained from the Land Titles Office.

The boundary definitions vary depending upon whether the strata scheme was registered before or after 1 July, 1974. Detailed reference is needed to SSMA and Strata Schemes (Freehold Development) Act 1973

What is Strata

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Strata can be applied to any of the following:

High rise
Various residential
Town houses, duplex, etc.
Factories
Offices
Retail

Prior to the introduction of the strata title legislation, it was not possible in Australia to hold a title deed for a part of a building. The Conveyancing (Strata) Act 1961 was introduced to enable the subdivision of lots into strata and the transfer of these titles. This was welcomed because owners received their title deed to a unit. Many changes have taken place and the legislation is now called Strata Schemes Management Act 1996.

Strata title has progressed considerably since its inception in the 60's. Strata title properties can be:

residential
commercial
retail
mixed use - ie retail/residential
commercial/residential
resorts
serviced apartments
caravan parks

The building can be high-rise, townhouses, separate villas, 2 duplexes. The common property can comprise recreational facilities, gym, sauna, swimming pool, tennis court, meeting room, golf course, etc. All owners contribute to the maintenance of these facilities.

In 1989 a further step forward was made when legislation commenced which introduced a "tiered" owners corporation system. This is called "Community Title". This brought even more adventurous ways of subdividing land and buildings. Community Associations have been established that include vineyards, horse stables, etc.

Strata title has enabled the subdivision of land and buildings into lots and common property. The "lots" are the units or other areas owned by owners. Apart from the unit there can be areas like laundries, car spaces, garages, marinas which form part of the lot.
The common property is everything that does not form part of a lot and is owned by the owners corporation (all the owners collectively).

Provided the zoning permits the construction of a strata scheme, approval needs to be obtained from the Local Council to proceed with the development and then the subdivision of the property into lots and common property. A registered surveyor draws a strata plan of subdivision showing which parts of the strata scheme will be lots, the remaining parts being common property. All lots are allocated a unit entitlement and the schedule of unit entitlements is shown on the strata plan.

This plan is approved by the Local Council and then registered at the Land Titles Office. Certificates of Title are then issued by the Land Titles Office for each lot and one for the common property of the owners corporation.

Once a strata plan is registered, not only does a strata scheme come into existence but an owners corporation is formed, which will then bear the name "The Owners - Strata Plan No….." (this number being allocated by the Land Titles Office).