Strata Reforms

Strata Reforms

As anyone who follows West Australian property knows, the most significant alterations to the Strata Titles Act in 35 years, became law on the 1st May 2020.


There have been many significant changes to the flexibility of strata schemes, including the ability to have leasehold schemes and staged subdivisions.  There are safeguards for strata buyers and more efficient dispute resolution as well as minimum requirements for strata managers.  The Act now also contains detailed provisions for the termination of a scheme including the ability for the forced sale of all lots in a scheme with less than unanimous approval, provided strict guidelines are followed including an independent review by the State Administrative Tribunal.


Whilst certainly long overdue, many of the more significant changes will only affect the minority of schemes.  That said, any owner of a strata property needs to be aware of the more administrative changes that came into force on the 1st May.


One such change heralded by the new Act is the introduction of a 10 year maintenance plan and reserve fund for all schemes where there are 10 or more lots or where the buildings have a replacement cost in excess of $5 million.  At the first AGM after 1 May 2021, a 10 year plan, drafted in accordance with the stipulations in the Regulations, must be submitted to the meeting.  The plan must detail the common property elements that are expected to require maintenance, repair, renewal or replacement in a 10-year period.  Strata Companies are required to make arrangements to fund these requirements via reserve funds.


Also introduced were electronic options for communications as well as voting and meeting attendance.  For the first time in WA, strata managers will have clear statutory duties which define their role and responsibilities.  They will be required to have a contract and that contract must include criminal reference checks as well as the training and qualifications of the individuals.  Strata managers will need to carry insurance and provide an annual return to Landgate with information about the schemes they manage.


The Act and Regulations detail some transitional arrangements surrounding strata manager training and the enforceability of existing contracts.  Each transitional arrangement has a different time period for compliance, with the most pressing being that contracts that were in existence at the 1st May 2020 become unenforceable after 31st October 2020 unless they were signed in accordance with the new Act.


The new Act stipulates that the Council of Owners may only sign contracts binding the Strata Company if they have been given approval to sign such a contract by the strata owners at a General Meeting.  This requirement has forced almost all Strata Companies to ensure they have a General Meeting before 31st October to ensure suppliers will continue to provide services after that date.


With over 74,000 strata schemes in Western Australia comprising more than 330,000 lots, these changes will affect a large portion of the property industry and in particular the 17% of schemes that have 5 lots or more.

With our strata division managing thousands of lots in hundreds of strata complexes, our team is well educated about the changes to the Act and would welcome your contact to discuss how the changes affect your investment.

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