Strata Title Reform – Are You Aware?
It has become clear that legislative updates are necessary to accommodate the advances being pushed by the property industry as it embraces new approaches for development and property management. As the legislation governing strata has remained relatively unchanged for the last few decades it is causing increased friction as people try to push boundaries in the property industry. With 40-50% of all new lots being strata, a significant portion of property in WA is being affected by these outdated Strata regulations. These increasingly apparent inadequacies of the current Strata Titles Act prompted the commencement of major strata reform that Western Australia is currently in the midst of. The primary aims of the reforms are to allow greater flexibility and options to drive better housing outcomes for developers, owners and residents, whilst making the process more transparent and enshrining better safeguards for those involved.
The updates aim to achieve the following:
1. Provide new land development options
2. Increase regulation & accountability for Strata managers
3. Streamline the strata dispute process & make it more accessible
4. Provide greater information for strata buyers
5. Include safeguards for scheme terminations
6. Improve scheme management options
7. Allow more flexible staged development
As a result of these Acts and to address the above two new strata types have emerged, community title and leasehold strata, outlined below.
-Allows for multiple sub-schemes, each with its own strata company
-Allows for strategic planning of large scale area development, with flexible stages and mixed use
-Encourages strategic density and mixed use areas along train lines and stations
-Will require a Community Development Statement to guide development approved by WAPC
-Fixed term of 20-99 years
-Buyer has a long term lease
-Owner of strata lease is issued with a Certificate of Title
-Owner can transfer lot & strata lease or mortgage the lot without the lessors consent
-For use of developments at train stations & for affordable housing
-All lots/leases to have the same expiry date
-Requires WAPC approval
Both the Strata Titles Amendment Act 2018 and the Community Titles Act 2018 have passed through parliament and received assent, however are awaiting Landgate to develop supporting regulations, after which proclamation will occur with the Strata Titles Act anticipated to come into operation later this year, and the Community Titles Act to come into operation in early 2020.
We anticipate that the most obvious transformation will be the growth of development around train stations and major transport corridors. There will be increased density around these hubs, with a focus on the METRONET station precincts. Additionally, the reforms will create new opportunities for mixed-use developments to ensure that communities are developed to provide diverse housing options integrated with an accompanying range of retail and commercial elements. We could also see greater levels of redevelopment of older strata properties, as the process of scheme terminations has been updated to be more navigable and realisable.
We look forward to engaging in projects that capitalise on these changes and witnessing how our communities evolve in response to these changes in the property industry. For more information, you can read the bills here:
Strata Titles Amendment Act 2018: http://www.parliament.wa.gov.au/parliament/bills.nsf/BillProgressPopup?openForm&ParentUNID=07FA9EA0FF54B548482582B90023602D
Landgate Strata Reform: https://strata.wa.gov.au/