Understanding Strata Titles in Perth
Strata titles are a common form of property ownership in Perth, particularly for apartments, units, and townhouses. Understanding how they work is crucial for both prospective buyers and current owners. This guide provides a comprehensive overview of strata titles, covering your rights, responsibilities, and the associated fees.
1. What is a Strata Title?
A strata title is a form of land title that allows individual ownership of part of a property (called a 'lot') as well as shared ownership of common areas. Think of it as owning your apartment within a larger building, while also jointly owning the hallways, gardens, and other shared facilities with the other apartment owners.
Key Components of a Strata Title
Lot: This is the individual unit or apartment that you own outright. It includes the internal walls, floors, and ceilings of your property.
Common Property: This includes all the areas within the strata scheme that are not part of individual lots. Examples include hallways, stairwells, gardens, swimming pools, gyms, and car parks. All lot owners collectively own the common property.
Strata Plan: This is a detailed diagram that shows the boundaries of each lot and the common property within the strata scheme. It's a crucial document for understanding the layout and ownership structure of the property.
Strata Company (also known as Owners Corporation): This is the legal entity made up of all the lot owners in the strata scheme. The strata company is responsible for managing and maintaining the common property.
Why Choose a Strata Title Property?
Strata title properties offer several advantages:
Affordability: Strata properties are often more affordable than freehold houses, making them a popular choice for first-time buyers and investors.
Shared Maintenance: The responsibility for maintaining common areas is shared among all owners, reducing the burden on individual owners.
Amenities: Many strata schemes offer amenities such as swimming pools, gyms, and gardens, which can enhance your lifestyle.
Security: Strata properties often have security features such as gated access and security cameras, providing added peace of mind.
2. Strata Fees and Levies
Strata fees, also known as levies, are regular payments made by lot owners to cover the costs of managing and maintaining the strata scheme. These fees are essential for ensuring the smooth operation and upkeep of the property.
Types of Strata Fees
Administrative Fund: This covers the day-to-day expenses of running the strata scheme, such as cleaning, gardening, insurance, and minor repairs. The administrative fund is usually calculated based on the lot entitlement of each property.
Reserve Fund (also known as Sinking Fund): This is a long-term savings fund used to cover major repairs and replacements of common property, such as painting the building, replacing the roof, or upgrading the lifts. Contributions to the reserve fund are usually based on a long-term maintenance plan.
Special Levies: These are one-off fees charged to lot owners to cover unexpected or significant expenses that are not covered by the administrative or reserve funds. Special levies require a vote by the owners corporation.
How Strata Fees are Calculated
Strata fees are typically calculated based on the 'lot entitlement' of each property. Lot entitlement is a figure assigned to each lot in the strata plan, reflecting its relative size and value compared to the other lots. Larger or more valuable lots generally have higher lot entitlements and therefore pay higher strata fees.
Understanding Your Strata Fee Statement
Your strata fee statement will typically include a breakdown of the fees payable, including the amounts allocated to the administrative fund, reserve fund, and any special levies. It's important to review your statement carefully and understand what you are paying for. If you have any questions, contact your strata manager or the owners corporation.
Budgeting for Strata Fees
When buying a strata title property, it's essential to factor in the cost of strata fees. These fees can vary significantly depending on the size and complexity of the strata scheme, the amenities offered, and the age and condition of the building. Obtain a copy of the strata budget and financial statements to get a clear understanding of the ongoing costs. You can also learn more about Marmionrealestate and our services to assist with your real estate decisions.
3. Owners Corporation Responsibilities
The owners corporation, comprising all the lot owners, has several key responsibilities for managing and maintaining the strata scheme. These responsibilities are outlined in the Strata Titles Act and the strata scheme's by-laws.
Key Responsibilities
Maintaining Common Property: The owners corporation is responsible for maintaining the common property in good repair, including gardens, hallways, stairwells, swimming pools, and other shared facilities.
Insurance: The owners corporation must take out adequate insurance cover for the building and common property, including public liability insurance.
Financial Management: The owners corporation is responsible for managing the strata scheme's finances, including collecting strata fees, preparing budgets, and keeping accurate financial records.
Enforcing By-Laws: The owners corporation is responsible for enforcing the strata scheme's by-laws, which are rules governing the use and enjoyment of the property. By-laws can cover a wide range of issues, such as noise levels, pet ownership, and parking restrictions.
Holding Meetings: The owners corporation must hold regular meetings, including annual general meetings (AGMs), to discuss important matters and make decisions about the management of the strata scheme.
Strata Management
Many owners corporations engage a professional strata manager to assist with their responsibilities. A strata manager can provide a range of services, including:
Collecting strata fees
Organising repairs and maintenance
Managing insurance claims
Enforcing by-laws
Preparing budgets and financial reports
Providing advice on strata title matters
Choosing a good strata manager is crucial for the smooth operation of the strata scheme. When choosing a provider, consider what Marmionrealestate offers and how it aligns with your needs.
4. Your Rights as a Strata Owner
As a strata owner, you have certain rights under the Strata Titles Act and the strata scheme's by-laws. Understanding your rights is essential for protecting your investment and ensuring a harmonious living environment.
Key Rights
Right to Participate in Decision-Making: You have the right to attend and vote at owners corporation meetings, allowing you to participate in decisions about the management of the strata scheme.
Right to Access Information: You have the right to access information about the strata scheme, including financial records, meeting minutes, and insurance policies.
Right to Use and Enjoy Common Property: You have the right to use and enjoy the common property, subject to the by-laws of the strata scheme.
Right to Lease or Sell Your Lot: You have the right to lease or sell your lot, subject to any restrictions in the strata scheme's by-laws.
Right to Request Mediation or Adjudication: If you have a dispute with the owners corporation or another lot owner, you have the right to request mediation or adjudication to resolve the issue.
Understanding By-Laws
By-laws are rules that govern the use and enjoyment of the strata property. They can cover a wide range of issues, such as:
Noise levels
Pet ownership
Parking restrictions
Use of common property
Building alterations
It's important to read and understand the by-laws of your strata scheme before buying or renting a property. Breaching the by-laws can result in fines or other penalties.
5. Dispute Resolution
Disputes can sometimes arise in strata schemes, whether between lot owners, or between lot owners and the owners corporation. It's important to have a clear understanding of the dispute resolution process.
Common Types of Disputes
By-law Breaches: Disputes often arise over alleged breaches of the strata scheme's by-laws, such as noise complaints or pet ownership issues.
Maintenance Issues: Disputes can occur over responsibility for maintenance and repairs, particularly in relation to common property.
Strata Fee Disputes: Disputes can arise over the amount or allocation of strata fees.
Decision-Making Disputes: Disagreements can occur over decisions made by the owners corporation, such as major renovations or changes to the by-laws.
Dispute Resolution Options
Internal Resolution: The first step in resolving a dispute is usually to try to resolve it internally, through communication and negotiation with the other party. The strata manager can often assist in facilitating this process.
Mediation: If internal resolution fails, mediation can be a useful tool. Mediation involves a neutral third party helping the parties to reach a mutually agreeable solution.
Adjudication: If mediation is unsuccessful, you can apply for adjudication through the State Administrative Tribunal (SAT). An adjudicator will hear evidence from both sides and make a binding decision.
Legal Action: As a last resort, you can take legal action through the courts. However, this can be a costly and time-consuming process.
Navigating strata titles can seem complex, but understanding your rights and responsibilities is key to a positive ownership experience. For frequently asked questions, visit our FAQ page.