Changes on the Horizon

Strata living arrangements are becoming an essential part of the way we own property, and, as a result, the NSW Government’s release of two draft bills to modernise the State’s strata laws has been welcomed across the board.

NSW is entering into a new development boom creating a need for strata scheme owners and managers to be more aware of what potentially lies ahead.

In anticipation, the NSW Government has committed to the reform of existing strata scheme laws.

Recently, the Minister for Fair Trading, Mr Dominello announced that the long awaited changes to strata schemes are getting closer to becoming a reality.

One of the more significant reforms is that the NSW Government plans to make it possible for a ‘strata scheme’ to be sold to developers if there is a majority of 75% or more of the owners that agree to do so, this is something that the Property Council of NSW has been requesting since 2003.

This reduced threshold will increase the rate at which a number of older strata buildings are being re-developed.

At the other end of the scale, the Engineers Australia Multi-disiplinary Committee has reported that 85% of strata units were defective on completion and that the cost of fixing apartment buildings after completion is an additional 27% of the original cost.  This staggering statistic needs to be over layed with the recent amendments to the HBA which has materially altered what constitutes a ‘major defect’.

As a result, both strata managers and owners must be prudent in obtaining fast and accurate advice as to how to address potential issues to ensure that the proper procedures are undertaken to protect their interests.

Many of the implications of these changes are yet to be seen, however, we strongly urge strata managers and owners to be diligent in ensuring their legal rights are protected.