Transcript - Strata Titles Act Reform

Landgate is delivering major reforms to strata legislation. Landgate is delivering the strata reforms because there have been no major reforms to strata legislation in 21 years. How we use and develop strata has rapidly evolved over that time. The old Strata Titles Act is causing problems for people living and working in strata. 

The strata reforms will improve the way things are done in strata by making strata better for owners and residents and introducing new land development options to drive economic growth. Strata reform will deliver major benefits for owners and residents in strata. Strata managers will be regulated and made accountable.

There will be a one stop shop for strata disputes. Strata schemes will be easier to manage and buyers of strata will get better strata information.

Strata reform will deliver major benefits to WA by introducing new development options that drive economic growth for the State. Community title will help to deliver smart density with amenity and better mixed use in Metrohub precincts.

Community title, leasehold strata and improved strata schemes will enable integrated land development along the transport corridors of Metronet and above train stations. Affordable housing can be provided with leasehold strata.

The key elements of the strata reforms are two new types of strata: Community title and Leasehold strata:

  • More flexible staged development 
  • Improved management of schemes
  • Simplified dispute resolution
  • Better information for strata buyers and
  • Safeguards for the termination of schemes.

Community title is a new type of strata which has multiple sub-schemes within an umbrella community scheme. Each sub-scheme has its own strata company. So why is Landgate introducing community title schemes to WA?

Other States and countries have community title schemes. Landgate investigated how community title is operating in those other States and we discovered the following.

  • Community title is ideal for large scale development
  • Breakfast Point is a community scheme in Sydney
  • It has 2500 lots contained in 50 sub-schemes spread across 52 hectares
  • The development began in 1999 and is still going and over $570 million has been invested so far.

Such developments take time and need flexible staging. More facilities can be shared by sub-schemes in a community title scheme. Community title supports mixed use in buildings and schemes and community title attracts major investment to generate economic growth.

Leasehold strata is a strata scheme set up for a fixed period of 20 to 99 years. The buyer acquires a long term lease of the lot, the strata lease. The owner of the strata lease is issued with a certificate of title.

The owner of the strata lease can transfer the lot and the strata lease and can also mortgage the lot all without needing the consent of the lessor. Leasehold strata is used in other parts of the World for development of train stations and to provide affordable housing.

The reforms will make staged development of strata schemes more flexible. It’s difficult to vary a staged scheme development now under the Act. The reforms will allow more flexibility in how staged schemes are developed. This will cut red tape and allow faster development of staged schemes. 

Strata reform will improve the management of schemes by

  • allowing electronic notices, voting and record keeping
  • by strengthening by-law enforcement
  • empowering strata companies to improve common property and
  • making it easier to install sustainable infrastructure such as solar panels

Strata managers will be regulated. The reforms will impose comprehensive statutory duties on strata managers. For example strata managers will have to 

Act in the best interests of the strata company

  • Inform the strata company of a conflict of interest or commission
  • Hold the strata company funds in a trust account and
  • Have educational qualifications and professional indemnity insurance coverage.

The strata company may terminate the strata manager’s contract if the contract or statutory duties are breached. Disputes between the strata manager and the strata company can be resolved by the State Administrative Tribunal.

The strata reforms will simplify strata dispute resolution. Currently strata disputes are heard in 4 different forums which include 3 Courts and 1 Tribunal. Research has proven that the State Administrative Tribunal or SAT is very effective in resolving strata disputes.

SAT will become the one-stop shop for strata disputes. The reforms will strengthen SAT’s powers to resolve strata disputes quickly and cheaply.  

Reforms to termination will introduce safeguards for owners require a transparent process be properly followed the vote is only one part of that process even if the required vote is reached the termination proposal must undergo a fairness and procedure review by SAT. Vulnerable owners will have access to funding to respond to the termination proposal.  Buyers of strata will receive better information. The strata information summary will be easier to read and electronic disclosure will be allowed.

Strata is very important to the WA economy. WA has over 300,000 strata lots which are worth over $170 billion. Strata is becoming more popular 40 to 50 percent of all new land subdivisions in WA are strata.Strata is more than just apartment housing, it is also used for commercial, retail and industrial premises.

More information on the strata reforms is detailed on Landgate’s website

This page was last updated on: 08 May 2018