February 19, 2018

Strata Titles Act Reform

Landgate is now well advanced 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. Landgate intents to introduce to Parliament in mid 2018 reforms to the Strata Titles Act.

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.

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.

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

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.

Landgate are proposing to provide time forthcoming for community consultation prior to reintroduction of the Bill to Parliament.

Article statistics sourced from Landgate, Western Australia, January 2018