As Australia’s population soars, living or investing in strata complexes has become an increasingly popular option for people of all ages and walks of life.
It’s estimated that at least 16% of Australia’s population lives in strata-titled properties, with this figure expected to continue growing rapidly in the coming years.
While strata living continues to grow, so too does the cost of maintaining these properties.
Strata managers play a crucial role in achieving this balance, navigating the line between keeping a property in great condition for the residents and owners and maintaining affordable levies.
The good news is that there are several ways that strata managers can help owner-occupiers and investors decrease strata levies in both the short and long term.
One of the largest expenses in a strata budget is insurance.
To save on strata levies, strata managers must have a thorough understanding of the insurance policies covering the property.
It's essential to ensure that the insurance policies are tailored to the specific needs of the strata complex so that it has adequate coverage for potential risks while avoiding over-insuring or duplicating coverage.
Exploring options like self-insurance can be a viable way to reduce insurance premiums.
To make sure you’re getting great coverage while also saving on costs, it’s essential that you carefully consider what needs to be insured and what can be managed internally.
By accepting a higher excess on insurance policies or specifying exclusions, property owners can save thousands on premiums.
In an era of environmental consciousness, embracing sustainability can not only benefit the planet but also contribute to substantial cost savings for your strata properties.
A great way to do this is to research the government rebates and sustainability incentive schemes available in your state and consider applying them to your strata properties.
Common initiatives include upgrading to energy-efficient LED lighting, installing solar panels, and providing subsidies for electric vehicle (EV) charging stations.
These investments not only reduce energy consumption and carbon footprints but also lead to long-term cost savings by reducing utility bills.
By staying informed about available incentives, strata managers can guide property owners towards sustainable practices that save on strata levies.
Preventative maintenance is an essential strategy for Australian property owners looking to save on strata levies.
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Maintenance programs should be in place to maintain critical infrastructure, prolong the life of equipment, and ensure maximum efficiency.
Regularly scheduled maintenance leads to fewer breakdowns, less inconvenience for residents, and ultimately, cost savings for property owners.
Strata managers can also explore options like scheduling appliances to operate during off-peak times and converting lighting systems to motion sensors to conserve power.
These measures can shave hundreds, possibly thousands, off yearly electricity bills, contributing to overall savings for the strata complex.
Many administrative costs incurred by owners’ corporations can be charged back to lot owners when appropriate administrative by-laws have been adopted.
Recent legal decisions in Australian tribunals have affirmed the use of these by-laws, which can provide an ongoing cost-saving mechanism for strata properties.
However, the terms and conditions of these by-laws must be fair and reasonable.
Strata managers should advise property owners to seek guidance from a specialist strata lawyer when considering the adoption of such by-laws.
Once adopted, they can effectively reduce overall strata levies.
Strata managers regularly review all contracts associated with a strata property, especially with utility, maintenance, and service providers, not only to reduce fees but also to negotiate additional services or fixed fees that allow the strata complex to plan and budget with more certainty.
When negotiating new contracts, strata managers can explore bulk tendering, which involves group buying power to gain maximum benefits.
This approach can be employed for services like electricity, lift agreements, and other service contracts.
Whether the strata complex has two lots or 2000 lots, a bulk tendering broker can align its needs with those of similar complexes to gain the maximum benefit, resulting in significant savings on strata levies.
By implementing these strategies, strata managers in Australia can help property owners save on strata levies while ensuring the long-term financial health and sustainability of their strata complexes.