Watch our video to see a snapshot of what strata reforms could mean for you.
The State Government has set strata reform as a key priority and Landgate has been tasked to deliver reforms to the Strata Titles Act 1985 (WA) (STA). The proposed reforms aim to ensure Western Australia has a modern Strata Titles Act to better meet the State's needs in light of future growth.
Reforms will help provide more flexible and sustainable housing options to benefit developers, strata owners, investors, residents and tenants. They do not aim to change current strata owners' land titles and boundaries, but do aim to improve the way strata schemes work.
The consultation period for the Strata Titles Act Reform is now closed. A consultation paper for Strata Titles Act Reform was released and an online tool was used to receive submissions and feedback. The three-month public consultation was open from 31 October 2014 to 16 January 2015. Though the public consultation period is closed, you can still read the consultation paper.
The STA project team is now focused on collating and analysing the large amount of feedback received via public consultation. A consultation summary will be presented to the Minister for Lands and then shared publicly in the coming months.
What is changing?
Scope of the strata reforms
The following areas are being investigated by the STA reform team, for their suitability and practicality:
Propose to introduce community titles to allow for:
- multiple levels of management for large-scale and/or mixed-use developments
- different schemes in one land parcel under an umbrella body corporate
- multiple strata schemes in one building to manage different uses (residential, commercial, retail).
Also leasehold titles to allow for:
- owners of freehold land to enter into long-term lease arrangements with developers
- Certificates of Title to be produced for leasehold titles, which is likely to enable better lending agreements.
Reforms will improve the materials that vendors of strata properties are required to give buyers before they sign the contract.
Currently strata disputes are dealt with in a number of forums (District Court, Supreme Court, Magistrate's Court and the State Administrative Tribunal [SAT]) – reforms propose to make SAT the 'one-stop-shop' for all strata disputes. This will be a more efficient and less costly process and is necessary if we are to have more people living and working in closer proximity.
Management of strata
Reforms aim to clarify the role and functions of strata companies, strata councils and strata managers - promoting greater transparency and accountability. They also propose to develop a code of conduct to set industry standards.
Termination of schemes
To determine when to upgrade and replace old housing stock and develop a model to terminate strata schemes if 100 per cent ownership agreement is not reached. Currently 100 per cent agreement between owners or a court order is required before a strata scheme can be terminated.
As the reforms are being progressed on a priority basis, any additional areas for improvement that are identified as part of the consultation may be considered. Due to the complexity of the reforms and short timeframe for implementing them however, it may not be possible to include additional items as part of this current program of reform.
Key benefits of the strata reforms:
- Reforms to the STA aim to create more choice and make shared living environments more attractive. It is then up to the industry to use these reforms to achieve this.
- Strata owners and managers will be more empowered and have access to more effective dispute resolution processes.
- Reforms are expected to attract and enable more developers to invest in WA.
- A more robust and modern STA will also ensure WA can better meet the State's needs in light of future growth.
- These reforms are not aimed at changing current strata owners' land titles and boundaries, but do aim to improve the way strata schemes work.
- Reforms will not change land titles or the boundaries of what you currently own in a strata scheme.
Why make changes?
Strata titles now comprise one third of new lots created in Western Australia, playing a significant role in providing flexibility in development as urban and rural land use changes to smaller lot sizes and multi-level apartment living. Land use in older urban areas is changing, with more multi-use developments, resulting in landowners seeking innovative ways to subdivide and redevelop land.
Strata titling is an accepted process for residential, commercial and industrial land and has gained acceptance in both new and historic building renovation schemes as well as in rural and resort developments. A subdivision under the STA gives the ability to build closer to boundaries, and the initial costs for a developer (e.g. power, water and gas) are substantially less than for a greenfields site under the Transfer of Land Act 1893. These factors make strata titles an attractive development option.
Western Australia's changing needs
In recent decades, Western Australia has experienced sustained population growth and all indicators suggest this will continue. The key need is to provide flexible and sustainable housing options (able to be used as a security by lenders) for a population estimated to be at around 3.5 million by 2031. The State Government's Directions 2031 target is for 121 000 dwellings of infill to be strata in the central Perth area.
This is proposed to be achieved with:
- more urban infill
- increased density
- community living in mixed-use environments.
The importance of strata legislation reform
Increased community living and mixed-use developments mean more people living, working and undertaking a range of activities in closer proximity.
With the higher density nature of the living environment, sharing of common facilities and the mutual dependence of one lot on another in a strata scheme, the STA sets up processes and structures to cope with that environment and to promote harmonious co-existence. The STA standard bylaws ensure standards of behaviour, building maintenance and management are maintained.
Although the STA has served Western Australia well, the need for it to be updated has been known for some time, and Landgate has been pursuing meaningful reform with stakeholders, including the public. Now, more than ever, as the demand for strata as a viable development option to help address housing options increases, the need for a robust and suitable legislative framework to support strata in Western Australia is critical.
How is the reform being progressed?
Landgate is progressing the reform agenda by:
- developing discussion papers in conjunction with key stakeholders, incorporating their feedback and also the lessons learned from other states
- conducting public consultation; all discussion papers developed on each area of reform were merged into a single consultation paper and then made available on the Strata Titles Act Reform webpage for public comment
- analysing submissions and summarising the outcomes of consultation
- preparing drafting instructions to amend the Strata Titles Act 1985 (Act) and requesting Cabinet to approve the drafting of a Bill to amend the Act
- requesting Cabinet for the Bill to be printed for introduction to Parliament.
Delivering the reforms
Government understands the scope of reforms being progressed is sizeable and that a collaborative effort with input from industry and government is essential if they are to be delivered in a timely manner.
In addition to the changes that are needed to the STA, there are also major IT system, policy and business process changes required for Landgate, the Office of State Revenue and other agencies. Also, new processes for industry and the public will need to be implemented, requiring extensive education and awareness raising efforts.
How have we consulted?
Our stakeholder engagement process has been ongoing for more than a year and followed a phased approach, to ensure we have proactively involved as many people as possible.
An initial phase of briefings and meetings with key stakeholders in Government and industry was undertaken and, on some outstanding issues, is still ongoing.
A three-month public consultation was open from 31 October 2014 to 16 January 2015 to receive feedback. Submissions were received via an online consultation tool, email and post or hand delivery to Landgate.
The STA reform team are also investigating the strata legislation and practices in other states: different models are in place in the different jurisdictions, each with varying levels of success. The aim is to learn from other jurisdictions, identifying what lessons can be applied to meet WA's needs.
The Strata Titles Act Reform team would like to acknowledge and thank the following stakeholders for their ongoing contributions to the reform process. This list continues to grow as the project progresses:
- Australian Institute of Conveyancers WA (AICWA)
- Allen Partners NSW
- ATCO Gas
- Atkinson Legal
- Australian Bankers Association
- Australian Property Institute
- Body Corporate Brokers (BCB)
- Building Commission (Dpt of Commerce)
- Cancer Council
- CHU Insurance
- Customer Service Council
- Department of Aboriginal Affairs
- Department of the Attorney General
- Department of Commerce
- Department of Finance – Office of State Revenue WA
- Department of Housing
- Department of Lands
- Department of Planning
- Department of Water
- Ernst & Young
- Exclusive Strata Management (ESM)
- Faculty of Law, QLD University of Technology
- Faculty of Law, NSW University of Technology
- Fair Trading NSW
- Fini Group of Companies
- Insurance Council of Australia
- Land and Property Information NSW
- Landgate SMEs
- Law Society of WA
- Catholic University of Australia Victoria
- LGA – City of Armadale
- LGA – City of Bayswater
- LGA – City of Belmont
- LGA – City of Perth
- LGA – City of Rockingham
- LGA – City of Stirling
- LGA – City of Swan
- Local Government Planners Association (LGPA)
- Metropolitan Redevelopment Authority (MRA)
- Planning Institute
- Property Council of Australia
- Real Estate Institute of Western Australia (REIWA)
- State Administrative Tribunal (SAT)
- Strata Community Australia NSW
- Strata Community Australia VIC
- Strata Community Australia WA (SCAWA)
- Strata Unit Underwriters
- Surveying & Spatial Sciences Institute (SSSI)
- Urban Development Institute of Australia (UDIA)
- WA Local Government Authority (WALGA)
Quote from UDIA's Strata Titles Act Reform submission covering letter (January 2015).
"UDIA is continuing to discuss the Strata Titles Reform project, meeting yesterday with the team from Landgate. A document has been developed after the initial round of meetings which is trying to capture the ideas of industry and regulators and poses a range of questions on which they are seeking feedback. UDIA appreciates the way in which this consultation is being undertaken, with a "work in progress" document being circulated and updated after meetings with key stakeholders – this approach is far superior to simply releasing a finalised discussion paper for feedback with no previous input."
Reproduced by permission of Debra Goostrey at UDIA.
For any enquiries about Strata Titles Act Reform, please email to StrataTitlesActReform@landgate.wa.gov.au.
This page was last updated on: 29 Jan 2015 4:01pm