presentation for nama indaba, johannesburg, south africa - may 2011

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A presentation about the first 50 years of strata title laws in Australia


  • 1. 50 Years of Strata Title in Australia
    6 May 2011
    Johannesburg, South Africa

2. Introduction
Australian housing overviewed
Strata in Australia begins
50 years of expansion & change
Some highlights along the way
Existing & emerging trends
Challenges for the future
3. Translations
Body Corporate=Owners Corporation
Common Property=Common Property
Developer=Original Owner
Rules=By Laws
Owner & Unit=Owner& Lot
Sectional Title=Strata Title
Sectional Plan=Strata Plan
Special Resolution=Special Resolution
Unanimous Resolution=Unanimous Resolution
4. Strata Housing in Australia
Mostly a country of urban sprawl but its changing
7.6 million square kilometres, 22.5 million people, 8 major cities (the largest with 4 million people)
A strong culture of property ownership, stable banking & long term low interest mortgage sector with taxation incentives for residential rental investment property
An enthusiastic property development sector operating in boom-bust cycles
Multi unit housing represents 25% of total Australian housing
51% of new housing in NSW in 2010 was multi unit housing
5. Strata Begins
Apartments appear in the early 20th century
Early ownership structures via company title
The post war period see many more low rise apartments mostly rented to younger couples saving for a home
1950s income & wealth levels of baby boomers lead to pressure to own apartments
Innovators looked at apartment titling options and Lend Lease (via Dick Dusseldorp) lobbies for & initiates strata title laws
The Conveyancing (Strata Titles) Act 1961 starts on 1 July 1961
6. The 1960s
First strata laws in NSW begin
Only 29 sections and two schedules (one schedule with only 10 lines
Laws copied in Tasmania, Queensland, Western Australia, Victoria & South Australia
First strata building remains in existence
Pioneering times for everyone
Surveyors dominated strata title matters
Approximately 8,000 strata buildings created
7. The 1970s
Strata laws introduced in Australian Capital Territory & Northern Territory
Major reform of NSW laws in 1974
New laws have 200 sections, 4 schedules & separate regulations
Australian laws copied in Canada, New Zealand, Singapore, South Africa, Indonesia, Malaysia, Fiji, Philippines, Cayman Islands, India & Hong Kong
Negative gearing promotes strata rental investment
Development of a specialised strata management industry
Approximately 18,000 strata buildings created
8. The 1980s
Major law reform in NSW with community title laws allowing estate subdivisions
Steady growth in strata numbers, popularity & values
Introduction of large scale foreign investment in strata property ownership
Professional strata associations/groups emerge
Regulation of strata managers in 2 states
Holiday apartment syndrome starts in Queensland
The first 500 plus lot strata schemes created
Approximately 30,000 strata buildings created
9. The 1990s
Major law reform in NSW with 2 part laws splitting development & management
In NSW over 400 sections, 13 schedules & 2 sets of regulations
Major law reform in Queensland in 1997 creating core Act & Regulation Modules for different building types
In Queensland over 250 sections & 5 modules with over 800 clauses
Australian Property boom means massive growth in strata numbers
Long term (25 year) on site management contract emerge
Separation of administrative work from building management/maintenance
Approximately 38,000 strata buildings created
10. The Naughties
Australian laws copied in United Kingdom & United Arab Emirates
Proliferation of law reforms in every Australian state
Over 33 separate strata Acts, with 1600 sections, 3000 regulations & 70 schedules
Proliferation of legal decisions in Courts around Australia
GFC puts pressure on property values & strata cashflows
Larger & more complex strata developments emerge but smaller sized housing units become standard in strata
Strata manager business polarise with large oligopoly style operators & micro businesses
Approximately 42,000 strata buildings created
11. Highlights over 50 Years
Frequent law review & reform
Promotion of flexible development options
Specialist dispute resolution
Regular superior Court consideration & decisions
Wide commercial acceptance of strata title
Public adoption of strata living within 50 years
Low level of manager regulation
12. Trends
Decentralised control away from committees
Increasing owner empowerment
Hyper-regulation of strata scheme operations
Degeneration of management into over-formality
Owner apathy & ignorance
Haphazard application of other laws
13. Future Challenges
Operational complexity
Effective strata scheme support services
Rapidly rising operating costs
Appropriate owner engagement
Tennant status vs. responsibilities
14. Some Thoughts
Demographic, economic & urban planning trends require more high density strata housing
But, owner & tenant experiences of strata owning & living are poor
Processes & outcomes need significant improvement
Otherwise strata will be a necessary housing evil and not a desirable option
People involved in strata will continue to struggle to be properly recognised & rewarded
15. Contacting Me
Contact me anytime about Australian strata matters
And, follow my blog on worldwide strata matters