Strata Management – A Comprehensive Guide

Strata Management
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The efficient, litigation-free, and timely management of jointly-owned is referred to as strata management. Often known as condominium management, community association management, or homeowners’ association (HOA) management, it is the operation and governance of property that is jointly owned and consists of individual units and shared common areas.

The concept of strata management is native to Australia and is derived from the ‘Strata Gate’ Australian law. As the idea of third-party management property management gained ground across countries, strata management began to be used in New Zealand, and British Columbia, Canada, apart from Australis. It is somewhat similar to condominium ownership in the United States.

In a strata scheme, individuals each own a ‘lot’, which is generally their apartment or townhouse, but the common property, like gardens, swimming pools, hallways, lifts, etc., is shared and maintained jointly. A strata scheme can be a residential, commercial, retail, mixed-use, or retirement village. The core idea of aiding prompt maintenance and enhancing a property’s value remains the same.

What is Strata Management

Strata management involves numerous roles and responsibilities, including the following:

Professional Guidance: A good strata management company has extensive knowledge about property laws, strata laws, and regulations, which can ensure compliance and avoid potential legal issues.

Property Maintenance and Repairs: Overseeing the maintenance of common areas, which could include landscaping, cleaning, and repair or replacement of shared facilities. Strata management ensures that common property, like lifts, gardens, gym, swimming pool, parking spaces, etc., is regularly maintained and kept in good condition, which helps retain or even increase the value of the properties.

Financial Management: Developing and managing the budget for the strata scheme, managing the strata bank accounts, levying fees to owners to address the common areas, and planning for future expenses. Strata managers handle the collection of levies from owners, manage the strata scheme’s budget, and pay for services like cleaning, maintenance, and insurance. Proper financial management can keep the strata scheme solvent and able to pay for necessary repairs and maintenance.

Rules Enforcement: A strata management body enforces by-laws/rules within the strata scheme. These rules can pertain to noise levels, pet ownership, parking, use of common facilities, etc. Enforcing these rules ensures a peaceful coexistence of all owners and tenants.

Administrative Duties: Laws and regulations vary between localities. A strata management company ensures compliance with local rules and strata by-laws, manages records and correspondence, and facilitates knowledge transfer among the owners.

Meetings and Governance: Organising and facilitating meetings for the owners’ corporation, also known as the body corporate or strata committee, helping in decision-making processes, and ensuring that decisions are implemented.

Legal Compliance: There are many legal responsibilities involved with managing a strata property. These can include occupational health and safety laws, fire safety regulations, and building codes, among others. Strata managers can help ensure that the strata scheme is compliant with these laws, which can help avoid fines or legal issues.

Effective Communication: A good strata management company will facilitate communication between the strata council and the owners or residents. This includes informing residents about meetings, changes to rules, and important events or issues that affect the strata scheme.

Dispute Resolution: Assisting in resolving conflicts between owners and between owners and the owner’s corporation. Strata management can help mediate disputes between owners, tenants, and other parties, which can be very beneficial in maintaining a peaceful community.

Improved Community Living: Effective strata management helps promote a positive community environment where rules are upheld, disputes are minimised, and shared spaces are well maintained.
Time-Saving: For strata committee members and owners, having a professional handle the day-to-day tasks and complexities of strata living can save significant time and stress.

Organising AGMs: A strata management committee holds the Annual General Meeting (AGM) to make decisions regarding annual budgets and the individual owner contributions they are liable to pay in the coming days. The AGM also elects a new committee for the following year. This meeting provides an opportunity for all residents to have one-on-one communication. This enables faster grievance redressal and helps resolve any issues that cropped up during the year.

Insurance: Making sure that the building and the common areas are appropriately insured. It helps rectify the failure of the owners to maintain insurance, keep adequate records or hold AGMs could open the owner’s corporation to penalties for non-compliance

By helping with all these issues, strata management can improve residents’ quality of life, protect owners’ interests, and maintain the overall value of the strata scheme.

The Importance of Strata Management

Many strata schemes engage professional strata management companies to handle these duties. However, smaller schemes may be managed by the owners themselves or a nominated individual from the property owners, typically in a voluntary or paid position. It’s a complex role that requires an understanding property management, financial planning, and legal requirements related to property ownership and management.

It’s important to note that the effectiveness of strata management can depend heavily on the quality of the strata management company or individual manager. Experience, expertise, and professionalism can significantly influence the level of benefits realised. A well-trained and experienced strata management company is a valuable asset for any strata scheme, providing owners and residents with expertise and peace of mind.

The specific services a strata management company provides can vary depending on the specific agreement between the strata corporation and the management company. Some strata corporations may choose to handle some tasks internally while outsourcing others to the management company.

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