Company strata is a type of property ownership that is becoming increasingly popular in Australia. It is a hybrid of strata title and company ownership, and it offers a number of advantages over both.
For one, company strata properties are easier to manage than traditional strata properties. This is because there is a single entity that is responsible for the property’s management, rather than a committee of owners.
This can make it easier to make decisions about repairs and maintenance, and it can also save owners money on administrative costs.
Discover everything there is to know about stratum titles by checking out our comprehensive guide on Stratum Title Meaning.
Read on to learn more.
Understanding Stratum and Strata Title
Stratum and strata title are two terms that are commonly used when referring to apartment buildings, townhouses, and other multi-unit developments. These terms are used to describe the legal structure of these types of properties and the rights and responsibilities of the owners.
Stratum Title
A stratum title is a type of property title that is used for multi-unit developments. This type of title is used when the units in the development are owned by individual owners, but the common property is owned by a separate entity, typically a service company.
In a stratum title, the owners of the units own shares in the service company, which gives them the right to use the common property. For those interested in buying a home in Australia, understanding the concept of stratum title is key.
Stratum title is a mixture of company share title and strata title. To gain a deeper understanding of this, you might want to explore what is a strata title. Stratum title dwellings are a physical parcel that are owned by their respective owner. The common property, however, is owned by a service company, of which the dwelling owners have shares within.
Strata Title
A strata title is a type of property title that is used for multi-unit developments, such as apartment buildings and townhouses. In a strata title, each unit in the development is owned by an individual owner, and the common property is owned jointly by all of the owners.
The owners of the units are responsible for the maintenance and repair of their own units, while the owners of the common property are responsible for the maintenance and repair of the common areas.
Strata title is a legal structure that is used to manage the ownership and use of multi-unit developments. It is governed by state and territory laws, which set out the rights and responsibilities of the owners and the owners corporation.
When considering purchasing a strata property, it’s important to know the history and condition of the entire building and not just the individual unit you’re interested in. One way to do this is by obtaining a strata inspection report.
Strata Scheme
A strata scheme is a type of property development that is governed by strata title. It involves the subdivision of a single property into multiple units, each of which is owned by an individual owner.
The owners of the units share ownership of the common property, which includes areas such as hallways, gardens, and parking areas.
Common Property
Common property is the property that is owned jointly by all of the owners in a strata scheme or stratum title. This includes areas such as hallways, gardens, and parking areas. The owners of the units are responsible for the maintenance and repair of the common property, and the cost of this maintenance is shared among all of the owners.
Units and Apartments
Units and apartments are the individual properties that make up a strata scheme or stratum title. Each unit or apartment is owned by an individual owner, who is responsible for the maintenance and repair of their own property. The owners of the units share ownership of the common property, which includes areas such as hallways, gardens, and parking areas.
In summary, stratum and strata title are two legal structures that are commonly used for multi-unit developments.
Stratum title involves the ownership of individual units and shares in a service company that owns the common property, while strata title involves the ownership of individual units and joint ownership of the common property.
The owners of the units are responsible for the maintenance and repair of their own properties, while the owners of the common property are responsible for the maintenance and repair of the common areas.
Company Title Vs Strata Title
When it comes to owning residential units, there are two main ways to do so: company title and strata title. While they may seem similar at first glance, there are some significant differences between the two. Learning about the pros and cons of buying property through a company can be an enlightening read for potential buyers.
Company Title
Under the company title system, the building is owned by a company. Instead of purchasing a lot or unit, buyers purchase shares in the company that owns the building. These shares give them the right to occupy a particular unit within the building.
One of the benefits of the company title system is that it can be more flexible than strata title. For example, the company can set its own rules and bylaws, which can be more tailored to the needs of the building and its occupants.
Additionally, the company can be more selective about who it allows to purchase shares in the building, which can help to maintain a certain level of quality.
However, there are also some downsides to the company title system. For example, shareholders may not have as much control over the building as they would under strata title. Additionally, the value of the shares may not appreciate in the same way that the value of a strata-titled unit would.
Strata Title
Under the strata title system, buyers purchase a lot or unit within a building. They also become a member of the owners corporation, which is responsible for managing the common property within the building.
One of the benefits of the strata title system is that it is generally more transparent and equitable than company title. The strata plan clearly defines the unit or lot ownership and which parts are common property, and everything operates through the owners corporation.
However, there are also some downsides to the strata title system. For example, owners must adhere to bylaws and pay regular levies for maintenance. They also share liability for any issues or damages to the building and common areas. Strata insurance is compulsory.
Company Title Vs Strata Title
When deciding between company title and strata title, buyers should consider their own needs and preferences. If they value flexibility and exclusivity, company title may be the better option. If they value transparency and equity, strata title may be the better option.
It is also important to note that the system used may vary depending on the state or territory in which the property is located. Buyers should familiarize themselves with the relevant laws and regulations before making a decision.
Strata Management and Its Importance
Strata management is the process of managing a strata scheme, which is a type of property ownership where individuals own a portion of a property, such as an apartment or townhouse, and share ownership of common areas with other owners.
Strata management services are provided by strata management companies, which are responsible for managing the day-to-day operations of the strata scheme on behalf of the owners.
The role of a strata manager is to ensure that the strata scheme is being managed in accordance with the relevant legislation, regulations, and by-laws. Strata managers are responsible for a wide range of tasks, including:
- Collecting levies and maintaining financial records
- Arranging maintenance and repairs to common property
- Enforcing by-laws and resolving disputes between owners
- Organising and attending meetings of the owners corporation
- Providing advice and support to the owners corporation
Strata management is important because it helps to ensure that the strata scheme is well-maintained and that the interests of all owners are protected. By engaging a strata management company, owners can benefit from the expertise of professional strata managers who have a deep understanding of the complexities of strata management.
Additionally, strata management companies can help to reduce the workload of the owners corporation by taking care of administrative tasks such as preparing financial statements and organising meetings.
This allows owners to focus on enjoying their property and living their lives, rather than being burdened with the day-to-day management of the strata scheme.
In summary, strata management is an important aspect of strata ownership, and engaging a professional strata management company can help to ensure that the strata scheme is well-maintained and that the interests of all owners are protected.
The Role of Owners Corporation
In a company strata, the owner’s corporation plays a crucial role in maintaining the property. The owner’s corporation is made up of all the owners within a strata scheme. It is responsible for managing and maintaining the common areas of a strata-titled property.
Examples of common property include communal gardens, foyers, lifts, gyms, driveways, and footpaths.
Every owner shares ownership of common property in a strata scheme. The owner’s corporation is responsible for ensuring that every owner is aware of their rights, responsibilities, and limitations.
It issues fee notices to owners and ensures that owners and residents have a copy of relevant state legislation and by-laws or building rules.
Owners who are elected to the owner’s corporation have specific duties and responsibilities. They must attend all committee meetings each year and read the meeting notices before attending the meeting. They are responsible for various jobs, such as obtaining quotes for painting or gardening.
Owners are automatically members of the owner’s corporation when they purchase a lot in a strata scheme. They have the right to attend meetings of the owner’s corporation and to vote on decisions that affect the management and maintenance of the common property.
In addition to the above, the owner’s corporation oversees and manages maintenance and repairs of common property. It also manages strata finances and funds. The owner’s corporation plays a critical role in ensuring that the strata scheme is well-maintained and that the property values are preserved.
Overall, the owner’s corporation is an essential entity in a company strata. It is responsible for managing and maintaining the common property, ensuring that owners are aware of their rights and responsibilities, and preserving the property values.
Understanding Strata Companies
Strata companies are a legal entity responsible for managing strata complexes. They are similar to other companies in Australia and can contract with third parties, borrow money, sue, and be sued in their own name. Strata companies are not individuals, and they require people to make decisions on their behalf.
The strata company is responsible for managing the common areas of the strata complex, including the building and land. The company is financially responsible for all assets and liabilities on behalf of all lot owners. It is essential for lot owners to understand that there is no cap on these liabilities, and they are exposed to any net liabilities of the strata company.
The strata roll is a list of all lot owners and their contact details. The strata company maintains this roll, and it is used for communication between the strata company and lot owners. Lot owners should ensure that their contact details are up to date on the strata roll to receive important information about the strata complex.
The body corporate is a group of lot owners who are responsible for making decisions about the strata complex. The body corporate elects a strata council to manage the day-to-day operations of the strata complex.
The strata council’s primary role is to ensure that the strata corporation is managed as required under the Strata Property Act and Agency Agreement.
Lot owners should also be aware of the financial health of the strata complex. The strata’s operating budget, depreciation report, and reserve fund study are important documents for understanding the strata corporation’s financial health and decision-making process.
If a lot owner is considering buying a unit in a strata development, they should request copies of these documents from the strata company.
In summary, strata companies are responsible for managing strata complexes and are financially responsible for all assets and liabilities. Lot owners should ensure their contact details are up to date on the strata roll and be aware of the financial health of the strata complex.
The body corporate elects the strata council to manage the day-to-day operations of the strata complex.
Key Aspects of Strata Scheme
A strata scheme is a legal arrangement that allows multiple owners to own individual units within a building or development, while also sharing ownership of common property. Here are some key aspects of a strata scheme that you should be aware of:
Strata Plan
A strata plan is a legal document that shows the layout of the building or development, including the boundaries of each individual unit and the common property. It also shows the unit entitlements, which determine how much each owner must contribute to the cost of running the strata scheme.
Levy
A levy is a fee that each owner pays to cover the cost of maintaining and managing the common property. Levies are usually paid quarterly and can be used to cover expenses such as insurance, repairs, and maintenance.
Annual General Meeting (AGM)
An AGM is a meeting of all owners in the strata scheme that is held once a year. At the AGM, owners can discuss important issues affecting the strata scheme, such as the budget and by-laws. Owners can also elect members to the strata committee, which is responsible for managing the strata scheme on behalf of the owners.
By-Law
By-laws are rules that govern the behavior of owners and tenants within the strata scheme. By-laws can cover a wide range of issues, such as pet ownership, noise levels, and parking. By-laws are enforced by the strata committee and can be changed by a vote of the owners at a general meeting.
Tenant
A tenant is someone who rents a unit within the strata scheme from the owner. Tenants must abide by the by-laws and rules of the strata scheme, and their behavior can affect the other owners and tenants in the building.
Driveway
The driveway is a common property area that is used to access the building or development. The driveway is usually maintained by the strata committee and can be a source of disputes between owners and tenants if it is not used properly.
Townhouse
A townhouse is a type of strata property that is usually two or three stories high and has its own front door and yard. Townhouses are often managed by a strata scheme, which is responsible for maintaining the common property and enforcing the by-laws.
Foyer
The foyer is a common property area that is usually located at the entrance of the building or development. The foyer is often used as a meeting place for owners and tenants and can be a source of disputes if it is not kept clean and tidy.
Strata Committees
The strata committee is a group of owners who are elected by the owners at the AGM. The strata committee is responsible for managing the strata scheme on behalf of the owners, including maintaining the common property, enforcing the by-laws, and managing the finances.
Mixed Use
A mixed-use strata scheme is a development that includes both residential and commercial units. Mixed-use strata schemes can be more complex to manage than residential-only schemes, as they require different by-laws and management structures.
Unit Entitlement
Unit entitlement is a measure of the value of each unit within the strata scheme. Unit entitlement is used to determine how much each owner must contribute to the cost of running the strata scheme, and is usually based on the size and location of the unit.
Owner of a Lot
The owner of a lot is the person or entity that owns an individual unit within the strata scheme. Owners have certain rights and responsibilities, such as paying levies, abiding by the by-laws, and participating in general meetings.
Frequently Asked Questions
What is a strata company in Australia?
A strata company is a legal entity that is created when a group of owners collectively own a building complex. Each owner owns a designated airspace in the building complex and is a member of the strata company. The strata company is responsible for managing and maintaining the common property in the building complex.
What is the difference between company title and strata title?
Company title is a form of ownership where the owner owns shares in a company that owns the building complex. Strata title is a form of ownership where the owner owns a designated airspace in the building complex and is a member of the strata company that owns the common property.
How does strata management work?
Strata management involves the management of the common property in the building complex. This includes the maintenance and repair of the common property, the management of the finances of the strata company, and the enforcement of the by-laws of the strata company.
What are common problems with company title?
Common problems with company title include difficulties in obtaining finance, restrictions on the use of the property, and limitations on the ability to sell the property.
What is the difference between stratum and strata title?
Stratum title is a form of ownership where the owner owns a portion of the land on which the building complex is built. Strata title is a form of ownership where the owner owns a designated airspace in the building complex and is a member of the strata company that owns the common property.
What is the role of a strata company in Sydney?
The role of a strata company in Sydney is to manage and maintain the common property in the building complex. This includes the management of the finances of the strata company, the enforcement of the by-laws of the strata company, and the maintenance and repair of the common property.
