Strata Title in Victoria – What It Is & How It Works

Strata Title in Victoria – What It Is & How It Works

What is strata, and what is the meaning of Strata Title? 

Strata title is a name given to a scheme of land ownership, where land and buildings are subdivided to create separate lots, each of which has its own land title, and common property such as driveways and gardens, which are jointly owned by all owners in the scheme. As such, “strata title” means the areas of the property in question, which what strata refers to in this context. In Victoria, an owners corporation, previously called body corporate, is responsible for managing the common property, such as arranging repairs and maintenance when required.

If you purchase a property which is part of a strata title scheme, you acquire a lot, such as an apartment, and also a share in the common property which can include foyers, fences, gardens, roofs which are the shared responsibility of the owners of all lots with the management and control vested in the owners corporation.

Does strata title only apply to residential buildings?

Strata title can affect different types of properties with the most common being residential apartments and townhouses.  However, there can also be strata titled commercial properties such as offices, shops, warehouses, factories and also retirement villages.  There can be a mix of uses within one property such as retail shops on the ground level and apartments on the upper levels of a building.

What Is The Size Of A Strata Scheme?

A strata scheme has a minimum of two members (lots) with the maximum only limited by the number of lots created by the plan of subdivision.  Large apartment buildings or housing estates can potentially have more than a thousand lots.

The extent of common property is set out in the plan of subdivision and may include footings and foundations, roofs, exterior walls, stairways, gardens and fences.  In Victoria there is no automatic determination that the structure of the building is common property as sometimes occurs in other states.  It requires reference to the plan of subdivision to determine the extent of common property.

Is a Duplex Townhouse a Strata Title?

In a duplex strata title townhouse development when the plan of subdivision is registered which creates each of the lots it will determine if it is a strata title giving rise to an owners corporation.  If it is a strata titled, the responsibility of the owners corporation may be relatively limited requiring that it only attend to common services and possibly insurance.  These developments may not have common property situated on the ground but can have common services such as shared water supply and drainage, which gives rise to the obligation of an owners corporation to ensure there is a party responsible to manage that infrastructure.

What about a Strata Title Apartment Block?

In a strata block, such as an apartment complex, the owners corporation will usually maintain footings and foundations, roofs, exterior of the building, foyers, gardens and fences as these are common property.  As a larger scheme, it has periodic caretaking carried out and attends to repairs of common property as required.

A large scheme will have more extensive common property and the obligations for maintenance will be more significant and may extend to maintaining lifts, providing a swimming pool and gymnasium and engaging a building manager.  These duties are in addition to maintaining common property such as roofs, stairs and entry foyers.

For these schemes, the owners corporation will insure all of the buildings for repair and reinstatement, including owners lots.  In a strata titled duplex, each owner will usually affect their own insurance at their cost.  However, they may wish to join in to have the owners corporation take out insurance for the entire development even though it is not required as there may be saving on the premium.

What Do I Need To Do To Join The Owners Corporation?

Upon notifying the owners corporation that a person is now the owner of a lot affected by it, membership of the owners corporation automatic and there is no separate transfer process required to be undertaken.

Upon becoming a member the owner may participate in the annual general meeting and utilise the common property in conjunction with other members and occupiers.  At the same time the owner will become liable for fees and charges imposed by the owners corporation and be bound by the rules.

How Do I Strata Title a Property?

If you purchase a lot affected by an owners corporation the property has already been strata titled and no steps are required by an owner.  Once that has been done, the plan of subdivision will prevail and is rarely amended.  If there is to be an amendment to a plan of subdivision, this requires advice of a legal practitioner and a land surveyor.

How Does A Strata Scheme Work?

The owners corporation is responsible for the common property and in most cases insurance.  In order to fund these works it is necessary that levies are raised.  The annual budget setting those levies is determined at each annual general meeting which members may attend.  A committee is elected from volunteer members at that meeting to represent all members in determining the functioning of the owners corporation during the financial year.  A strata scheme will usually engage a manager to undertake the administrative duties, including accounting, of the owners corporation.

What Are Strata Rules?  

As with any community, it is necessary there are rules to assist in a harmonious living.  Rules will address matters of amenity such as noise, the use of common property and altering external appearance a lot.  An owners corporation may make its own rules if it wishes which is particularly relevant if there are facilities such as swimming pools and gymnasiums which require specific regulation.

What Are My Obligations As An Owner?  

The owner of a strata title lot is required to contribute to the costs of operation of the owners corporation which typically includes insurance, maintenance and repair of common property and the administrative expenses such as accounting fees.  An owner is required to observe the rules of the owners corporation and maintain their lot in a state of good and serviceable repair.

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