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I am constantly being asked, WHAT IS STRATA?

Well, putting it simply, Strata is a system, first introduced into Australia in NSW in 1961, for handling the legal ownership of a 'portion' of a larger apartment block.  These 'portions' are known as 'lots' and can be applied to any of the following:

  • 3-storey unit blocks
  • High rises of 4 or more storeys - both residential and commercial
  • Townhouses, townhomes, villas, duplexes, triplexes, etc.
  • Factories, warehouses and storage units
  • Retail Shops
  • Offices

Prior to the introduction of the strata title legislation, it was not possible in Australia to hold a title deed for a 'part' of a building.  The Conveyancing (Strata) Act 1961 was introduced to enable the subdivision of lots into strata and the transfer of these titles.  This was welcomed because owners received their title deed to a unit.  Many changes have taken place and the legislation is now called the Strata Schemes Management Act 1996(NSW).

Thankfully, Strata title has progressed considerably since its inception in the 60's.  Strata title properties can be:

  • residential
  • commercial
  • retail
  • mixed use - ie retail and/or commercial and/or residential
  • serviced apartments
  • caravan parks
  • resorts and hotels

The building can be high-rise, 3-storey, townhouses, townhomes, separate villas, a duplex, a triplex, a factory, a row of shops and so on.  Strata title has enabled the subdivision of land and buildings into "lots" and "common property".

LOTS and COMMON PROPERTY
Lots are the units (or apartments or townhouses, etc) or any other areas owned by owners which form part of the lot like laundries, car spaces, garages, marinas, storerooms, etc. and each is shown on the title as being owned by a Lot Owner.

Common Property is defined as everything else on the parcel of land that is NOT comprised in a lot, such as common stairwells, driveways, roofs, gardens, main gates, garbage areas, exterior walls and windows, balconies, lifts as well as recreational facilities such as gym, sauna, swimming pool, tennis court, meeting room, golf course, etc.

Common Property is owned by the Owners Corporation which comprises all the lot owners as a collective and, as such, all owners contribute to the maintenance of these 'common' facilities through a levy payment system.

COMMON PROPERTY OR NOT?
The boundaries between common property and lots are shown on the registered strata plan.  For detailed information about boundaries, reference should be made to the
Strata Schemes Management Act 1996(NSW) or the NSW Dept of Fair Trading.  A copy of the relevant strata scheme can be obtained from the Land Titles Office of NSW.

The boundary definitions vary depending upon whether the strata scheme was registered before or after 1 July, 1974.  Detailed reference is needed to Strata Schemes Freehold Development Act 1973(NSW) and the Strata Schemes Management Act 1996(NSW)

COMMUNITIES
In 1989 a further step forward was made when legislation commenced which introduced a "tiered" Owners Corporation system.  This is called Community Title and brought even more adventurous ways of subdividing land and buildings.  Community Associations have been established that include vineyards, horse stables, etc.  These community schemes are also sometimes referred to as Neighbourhood Schemes.

HOW IT ALL STARTS
Provided the zoning permits the construction of a strata scheme, approval needs to be obtained from the local council to proceed with the development and then the subdivision of the property into lots and common property.  A registered surveyor draws a strata plan of subdivision showing which parts of the strata scheme will be lots, the remaining parts being common property.  All lots are allocated a "unit entitlement" and the schedule of unit entitlements is shown on the strata plan.  These "unit entitlements" determine how the levy payments will be divided up amongst the owners.  The larger the unit entitlement of a lot, the more the levy will be.

This plan is approved by the Local Council and then registered at the Land Titles Office.  Certificates of Title are then issued by the Land Titles Office for each lot and one for the common property of the Owners Corporation.

Once a strata plan is registered, not only does a strata scheme come into existence but an Owners Corporation is formed, which will then bear the name "The Owners - Strata Plan No..." (this number being allocated by the Land Titles Office).

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DISCLAIMER:  All information on this website is of a general nature and is intended as a guide only.  Readers should check all information obtained from this website for accuracy from other sources and seek professional legal advice before taking any action based on any information obtained from this website.  Information on this website should not be substituted for proper legal advice.  The owners of this website will not be held responsible for any action taken as a consequence of same.

EXTERNAL SOURCES:  The owners of this website do not make any warranty or representations regarding the information, products, services or qualifications of any external sources listed on this website.  Readers should make their own appropriate enquiries regarding accuracy, qualifications, licences, etc.  The owners of this website will not be responsible or liable in any way for any representations made by any external sources listed on this website.

IMPORTANT NOTE:  This website deals with strata matters in NSW, Australia only.  Legislation varies in different states and territories and in other countries.  For information pertaining to places outside of NSW, Australia please refer to the appropriate legislation for your region.

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