Before buying a property on a strata scheme, it is important you understand what you are entitled to.
A strata scheme is a piece of land…
…that contains a building or a collection of buildings that has been divided into ‘lots’. Lots can be individual units/apartments, townhouses or houses. When a person buys a property within a strata scheme, they obtain their own lot which is listed on their Certificate of Title, This Strata or Survey Strata Titled lot comprises of both individual ownership of some areas and shared ownership of other common property areas.
Before buying a property on a Strata Scheme, it is very important to see a copy of the associated plan, to check what forms part of the individual property and what forms part of the common/shared property. Common property refers to the areas in which every occupier or owner shares, this can include things such as foyers, driveways, fences, visitors parking, exterior walls, courtyards, roofs, as well as shared facilities such as laundries, swimming pools, stairwells, lifts and gardens.
There are a large number of combinations of individual ownership and common/shared ownership…
…For example, there may be individual ownership of inside and outside areas, but only a portion of the building e.g. the walls and roof are considered common property; or there could be ownership of the inside of the building, but outdoor areas are classified as common area; another common example in Survey Strata lots is individual ownership of the building and yard but shared ownership of fences and the driveway within the plan – even if this driveway is not used by all owners or if the fence is not attached to that particular lot.
Unit entitlement is recorded on the strata or survey-strata plan for each property, this number signifies your proportional entitlement and obligation within the whole strata scheme, it is your share of the total value of that Strata Scheme and is set by a Licensed Valuer.
Understanding your unit entitlement and the associated responsibilities is very important before purchasing a lot on a strata scheme…
…As an owner of one of these properties, your obligation is to participate in its management, and therefore where common/shared property is concerned you are jointly responsible for repairs, insurances and maintenance of the shared areas. If you do not have insurance in place for the common areas within your Strata Scheme you could be caught out with unforeseen repair costs for that portion outlined in your unit entitlement.
WRITTEN BY JULIE PEDULLA