A strata community is the name given to people who live in a strata-titled building. In Victoria is it known as an Owners Corporation.
An Owners Corporation is the collective group of owners within a property which contains common property. This may be a residential, commercial, industrial or mixed-use development. An Owners Corporation manages the common property and is created when a plan of subdivision is lodged containing common property.
An Owners Corporation is a legal structure designed for apartment buildings, townhouse complexes. It even extends to industrial parks, office buildings and shopping centres.
When you purchase in a strata-titled building, you’ve not just bought an apartment or a lot, but you’ve also bought part of the building itself and all the associated common areas (such as hallways or facilities such as a swimming pool or a lift).
Owners are responsible for the maintenance of their own lot and the upkeep of all of the common areas as well.
Depending in which state you live in, a strata community may be referred to as:
- An Owners Corporation, or;
- A Body Corporate.
Terminology changes from state-to-state but the purpose is the broadly the same.
What is the purpose of an Owners Corporation?
An Owners Corporation exists to manage issues mutual interest to all the owners. They include:
- Issues related to people living together;
- Physical property includes gardens, common building structures and shared assets such as recreation clubs and tennis courts.
What are the responsibilities of an Owners Corporation?
The responsibilities of an Owners Corporation governed by legislation.
In a nutshell, the duties are:
- Administer the common property and the Owners Corporation assets for the benefit of the owners of lots included in the scheme;
- Maintain common property to the extent it is in structurally sound condition;
- Enforce community rules;
- Carry out other functions given to the Owners Corporation under legislation, such as keeping records about its operations, meetings and owners;
- The Owners Corporation is not legally able to do anything other than fulfil these mandatory responsibilities. In performing these duties, the Owners Corporation can enter into contracts, employ staff and generally deal with property. Unlike a commercial company, it cannot conduct businesses, such as a letting agency, tour operation or restaurant.
How Is an Owners Corporation Financed?
Every owner makes contributions, known as fees. These are pooled to maintain the community and common areas. The size and frequency of the contributions required to properly run the Owners Corporation are decided by all owners at the annual general meeting.
How Does the Owners Corporation Make Decisions?
Decisions are made by owners in four ways:
- At a meeting of all the owners (a general meeting);
- At a meeting of the committee for the Owners Corporation;
- By a ballot of all the owners; and
- By a ballot of the Committee.
It is important to note that no individual acting in isolation can make decisions on behalf of all the owners.
SSKB is Australia’s leading strata management company, specialising delivering expert advice and management to Owners Corporation and Body Corporate communities.