NSW Strata Reforms 2025:
What Developers Need to Know

On 1 July 2025, major strata reforms came into effect across New South Wales, with further changes scheduled to roll out later this year. While much of the conversation has focused on owners corporations and committees, developers play a critical role in ensuring compliance, reducing risk, and protecting their long-term reputation.

Why These Reforms Matter to Developers

Strata is no longer viewed as a post-handover issue. Purchasers, committees, and regulators are placing greater scrutiny on how developments are handed over, encompassing aspects such as utility contracts, budgeting accuracy, sustainability planning, and documentation quality.

Getting these early decisions right isn’t just about compliance — it can significantly reduce friction, levy shocks, and reputational damage once the building is occupied.

Key Areas of Impact for Developers

Initial Maintenance Schedule Now Tied to Capital Works Planning

The reforms require owners corporations to prepare their first 10-year capital works fund plan based on the developer’s initial maintenance schedule provided at the first AGM.

If the schedule is generic, incomplete, or unclear, the resulting capital works plan may underestimate future costs, leading to sudden levy increases in year two, buyer dissatisfaction, and committee pressure.

Best practice: Ensure your maintenance schedule is tailored to the specific building, includes service level assumptions, and accounts for items like lifts, fire systems, plant, and solar. Strata Plus can assist in reviewing or preparing this documentation.

Utility Contracts and Embedded Networks Under Scrutiny

New rules require utility contracts (including electricity, waste, stormwater, and EV charging) to:

• Expire at the first AGM if entered into pre-handover, or
• Be limited to a maximum three-year term, and
• Include a clear disclosure of terms and conditions.

Developers who lock in long-term, inflexible utility contracts now face compliance risk and possible buyer backlash.

Tip: Review all embedded network and utility arrangements to ensure they meet the new standards, particularly if presales marketing references sustainability or EV-readiness.

Handover Obligations Carry Higher Stakes

Developers face increased penalties for failing to:

• Hold the first AGM on time, or
• Provide required documents (including building manuals, warranties, and compliance certificates).
• Incomplete handovers can trigger regulatory fines and damage buyer trust, especially when issues arise post-settlement.

Tip: Use a structured handover checklist and engage your appointed strata manager early. Strata Plus supports developers with comprehensive handover audits to ensure every obligation is met.

Contracts Must Be Fair and Transparent

Any contract entered into, renewed, or varied after 1 July 2025 must not include unfair terms. This applies to:

• Strata management contracts
• Building management agreements
• Cleaning, gardening, and service contracts

One-sided cancellation clauses, automatic renewals, and penalty terms are now prohibited. Contracts must be clear, reasonable, and reviewable.

What to do: Ensure any contract the owners corporation inherits — even if initiated by the developer — is compliant. Strata Plus can review draft agreements to ensure they meet legislative requirements.

At Strata Plus, we help developers:

• Capture all common property in a central asset register
• Go to early tender for major contracts (cleaning, fire, lifts, insurance)
• Apply realistic service levels, not placeholders
• Include allowances for key items like fire compliance and lift servicing, even when under DLP
• Model year-two outgoings early to avoid levy shocks and buyer concerns
• Forward-planning reduces complaints, supports resale value, and positions your brand as one that delivers quality — both at settlement and beyond.

The Bottom Line

These reforms reinforce a clear message: strata success starts during development.

From handover compliance to operational planning, the most successful projects involve strata professionals early — not just at registration. Doing so helps manage risk, streamline governance, and protect your hard-earned reputation in a competitive market.

Strata Plus partners with developers from concept to completion. We help ensure your building is delivered in full compliance, with documentation, budgets, and operational planning that stand the test of time.

Get in touch to schedule a developer consultation or handover review.