What strata owners need to know
Starting February 3, 2025, significant changes are coming to how strata managers must disclose information to strata owners. These new requirements are designed to provide you with greater transparency and control over your strata scheme’s management.
What’s Changing and How It Benefits Strata Owners
Before appointing a strata manager
Strata managers must now disclose:
- Their connections with suppliers they regularly use, including detailed information about these relationships.
- Whether they’ve provided advice about strata plans to your building’s developer in the past two years.
During their appointment
Your strata manager will be required to provide more frequent and detailed updates throughout their tenure through real time disclosures. Your strata manager must promptly inform you in writing when they:
- Develop new connections with service providers working with your strata scheme.
- Purchase property within your strata scheme.
- Plan to enter into contracts on behalf of the owners corporation using related suppliers.
Commission and training services
Before receiving any commissions or training services not included in the original management agreement, your strata manager must:
- Provide a written explanation justifying why the approval serves the owners corporation’s interests.
- Disclose the exact commission amount.
- Obtain approval through an owners corporation meeting.
Annual General Meeting transparency
At each AGM, your strata manager is required to provide information about:
- The strata manager’s connections with suppliers and developers over the past 12 months.
- Commissions and training services received in the past year.
- Expected commissions and training services for the upcoming year.
Insurance changes
The new requirements bring welcome transparency to insurance arrangements. Insurance quotes must be clearly itemised, showing:
- Base premium amount
- GST
- Commission amounts
- Broker fees
- Recipients of all payments
Importantly, strata managers cannot collect commissions on insurance if the owners corporation independently obtained quotes and arranged payments.
What this means for owners
These changes significantly strengthen your protection as a strata owner:
- You’ll have better information to make decisions about appointing and retaining strata managers.
- You’ll receive prompt updates about any potential conflicts of interest.
- You’ll have clearer visibility of all costs, especially regarding insurance.
- You’ll have more control over additional fees and commissions your strata manager receives.
Protecting your interests
Strata managers face substantial penalties (up to $110,000) for breaching these disclosure requirements. As a strata owner, you should:
- Review insurance documentation carefully.
- Actively participate in owners corporation meetings where approvals are sought.
- Ensure your strata committee members understand these requirements to help monitor compliance.
These new regulations represent a significant step forward in protecting strata owners’ interests and ensuring more transparent strata management practices.
They provide you with the information needed to make better decisions about your property and ensure your strata manager acts in your best interests. For more information, contact your Strata + strata manager.
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