If you are considering buying an apartment, townhouse or unit in Australia, you will almost certainly encounter strata title. Understanding how it works before you buy can save you from unexpected costs, restrictions and disputes down the track.
What Is Strata Title?
Strata title is a form of property ownership that divides a building or development into individual lots (your apartment or unit) and shared common property (corridors, gardens, driveways, lifts and building structures). You own your individual lot outright and share ownership of the common property with other lot owners through an owners corporation (also called a body corporate in some states).
What Is an Owners Corporation?
An owners corporation is the legal body that manages the shared common property of a strata development. It is made up of all the lot owners in the building. The owners corporation is responsible for maintaining common areas, arranging building insurance, setting by-laws and managing the building’s finances through levies paid by all owners.
What Are Strata Levies?
Strata levies are regular fees paid by each lot owner to fund the owners corporation. There are typically two types:
- Administrative fund levies: Cover day-to-day expenses like cleaning, gardening, insurance and minor repairs.
- Capital works fund levies (sinking fund): Set aside for major future repairs like roof replacement, lift upgrades and painting.
Levies vary enormously — from a few hundred dollars per quarter for a small block to several thousand per quarter for a premium high-rise. Always review the owners corporation financials before buying.
What Are By-Laws?
By-laws are the rules that govern what lot owners and tenants can and cannot do in a strata property. They can cover pets, renovations, noise, parking, smoking and short-stay rentals. By-laws vary between strata schemes, so it is important to review them before purchasing — especially if you plan to renovate, keep a pet, or use the property for Airbnb.
What to Check Before Buying a Strata Property
- Review the owners corporation financials — are levies being paid? Is there enough in the capital works fund?
- Check for outstanding special levies — large one-off levies for major repairs can cost tens of thousands
- Read the by-laws — are pets, renovations or short-stay rentals permitted?
- Review meeting minutes — are there any ongoing disputes, litigation or major works planned?
- Check the building insurance — is it adequate and current?
How Can a Property Advisor Help?
A Collings property advisor reviews the owners corporation records as part of our buyer advisory service, helping you identify red flags before you commit. Our fixed fee of $4,500 + GST includes a full property assessment, comparable sales analysis and contract support — so you buy with confidence.
Strata Title FAQ
Is strata title the same as a body corporate?
Yes. Body corporate is the term used in Queensland; owners corporation is used in Victoria and NSW. Both refer to the same legal entity that manages common property in a strata scheme.
Can I renovate a strata property?
Minor cosmetic works generally do not require owners corporation approval. Structural changes, changes to external appearance or works affecting common property require formal approval under most by-laws.
What happens if the owners corporation does not have enough money in the sinking fund?
A special levy may be issued to all lot owners to cover the shortfall. This can be a significant unexpected cost — sometimes tens of thousands of dollars — which is why reviewing the capital works fund before buying is essential.
Get Independent Property Advice Before You Buy
Strata properties come with layers of complexity that go beyond the purchase price. Collings Property Advisory provides independent guidance for buyers at a fixed fee of $4,500 + GST — including a full review of owners corporation records, by-laws and building finances.
Talk to a Collings property advisor today before you commit to a strata purchase.
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