admin-ajax.php

Strata Title

Strata title is a form of ownership devised for multi-level apartment blocks and horizontal subdivisions with shared or common areas.

The ‘strata’ part of the term originally came from the fact that  apartments were on different levels or “strata”.

Interestingly the  Strata title was conceived in Australia and first introduced in NSW in 1961 to better cope with the legal ownership of apartment blocks.

Previously, the only adequate method of dividing ownership was company title, which had a number of defects, such as the difficulty of organising mortgages.

Strata title allows individual ownership of part of a property called a ‘lot’ generally an apartment or townhouse, combined with shared ownership in the remainder called ‘Common Property’ through a legal entity called (depending on your state or territory or residence and the type of scheme) ‘the owners corporation’, ‘strata company’ or ‘community association’.

Common Property includes but not limited to: foyers, lifts, driveways, gardens, swimming pools, gyms, and everything else that is part of the complex.

Being an owner in a strata scheme:

  • Your ownership includes your individual unit or apartment as well as sharing ownership and responsibility for the Common Property.
  • You are automatically a member of the Owners Corporation, which has responsibility for the Common Property.
  • You will regularly (generally every 3 months) need to contribute to the cost of running the building through paying Strata Levies in addition to rates and taxes for your property.
  • Compared to owning a freestanding house, there could be lifestyle restrictions in a strata scheme, e.g. there are rules (by-laws) that may affect you doing renovations to your unit; where you can and cannot park your car; noise control; where you can dry washing; whether you can or cannot keep pets.
  • Each owner has principle obligations in relation to their lot and the common property and if they are an investor to ensure compliance with the scheme’s by-laws is a condition of the tenancy agreement

According to Grattan Institute research “There are currently more than 1.5 million people living in strata buildings in NSW and in the next two decades will see this number rise by another million.”

« Back to Glossary Index


Want more of this type of information?


Avatar for Property Update

About

Michael is a director of Metropole Property Strategists who help their clients grow, protect and pass on their wealth through independent, unbiased property advice and advocacy. He's once again been voted Australia's leading property investment adviser and his opinions are regularly featured in the media. Visit Metropole.com.au


'Strata Title' have no comments

Be the first to comment this post!

Would you like to share your thoughts?

Your email address will not be published.
CAPTCHA Image

*