All posts by Russell Young

Developer-friendly strata managers (some are a problem)

By | Strata, Strata Management, Strata Schemes, Uncategorized | No Comments

What does the term “Developer-friendly strata manager” refer to? Simply, it is the idea that a Strata Managing Agent who has a close relationship with a Developer might not fully assist their client (the Owners Corporation) to take action against the Developer or Builder. This is particularly relevant with building defects, for which there are deadlines by which time certain actions must be undertaken if legal rights are to be exercised, or retained ready to exercise if necessary. It’s important to understand that not all Strata Managing Agents that accept appontments from developers are failing to help their client Owners…

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Solving under-investment in Strata: Governance and Meetings

By | Uncategorized | No Comments

Young Strata is a Strata Management Agency that has grown by appointment to clients when they change Agency, rather than by purchasing management contracts from a former agent selling them. Although some clients change agency for price (or more often for value), our experience has been that most Owners Corporations don’t actually change Agency until there is a level of frustration with service or performance. If nobody is in control then nobody is in control You may have read articles or case studies of Owners Corporations choosing to spend money to invest in their strata building to protect or improve…

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Ready or not, here it comes – Strata Schemes Management Act to Commence 30th November 2016

By | Strata, Strata Management, Strata Reform, Strata Schemes | No Comments

30th November has been announced as the commencement date for the new Strata Schemes Management Act 2015. Draft Regulations to support the Act were exhibited and the end of April 2016 with consultation closing on 27 May 2016, but but have not been finalised. This leaves strata managers, software developers, solicitors assisting the industry, and Owners Corporations themselves very little time to prepare. Indeed, many Agency Agreements recently entered into by Owners Corporations and Strata Managing Agents will extend well beyond the transitional provisions, but had to be drafted without the benefit of finalised legislation. http://www.domain.com.au/news/start-date-for-new-nsw-strata-laws-set-but-defects-bond-on-hold-20160707-gq16ss/

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Emergency Services funding reform to reduce Strata insurance costs

By | Strata, Strata Schemes | No Comments

We are pleased to share the good news that owners in Strata Schemes stand to benefit from the move to a fairer system of funding Emergency Services, involving the removal of the Emergency Services Levy (ESL) currently applied to insurance policies and replacement with the Emergency Services Property Levy (ESPL) paid alongside Council Rates. Such a change will broaden the base of collection, to the benefit of those who currently insure their properties and therefore bear the cost avoided by those who choose not to insure. Required by legislation to insure their buildings, Strata Schemes have long been subsidising non-insurers. Although…

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Commencement of new Strata legislation deferred

By | Strata, Strata Management, Strata Reform, Strata Schemes | No Comments

The Commencement date for the Strata Schemes Management Act 2015 was initially expected to be 1 July 2016. We now understand that Commencement will not be until September 2016, at earliest. We are expecting the Regulations to the new Act to be released during March or April 2016, and hope to have more certainty about the Commencement date shortly thereafter.

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Renewing the Strata Manager’s contract?

By | Strata Management, Strata Reform, Strata Schemes | No Comments

A few people have recently spoken to me about other agents asking them to sign new 3-year contracts and describing them as a requirement of the new strata legislation, which is expected to commence on 1st July 2016. What is changing? Amongst other changes, when the new legislation comes into force Agency Agreements between the Strata Managing Agent and the client (Owners Corporation, or ‘OC’) will be limited to a maximum term of 3 years. After 3 years the Strata Committee, the replacement of what is currently known as the ‘Executive Committee’, would then be able to extend the appointment in…

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New Strata legislation passes with only minor amendments

By | Strata Reform, Strata Schemes | No Comments

Yesterday the new Strata legislation passed through NSW Parliament, with only minor amendments to the Bills as introduced. Although not confirmed, the current expectation is for Commencement on 1st July 2016. Strata Renewal (“forced sales”) – 75% support is enough This may be a source of disappointment to those hoping for the hurdle to Strata Renewal (‘forced sales’) to be set at level of agreement higher than 75%. The timeline for a plan to be accepted or rejected was shortened from the draft of the Development Bill that was exhibited earlier in the year, disclosure requirements were slightly increased and other minor…

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Strata Bills introduced to NSW parliament – with a few surprises

By | Strata Reform, Strata Schemes | No Comments

The long-awaited Bills for Strata Schemes Management and Strata Schemes Development were finally introduced to parliament two days ago. Many of the proposed reforms are no surprise to those who reviewed the exposure drafts, including limiting Proxy ‘farming’;  new processes for classifying and approving renovations; permitting electronic service of notices; flexible meeting practices allowing for remote participation as well as for secret ballots; permitting a by-law to limit the maximum number of occupants; special requirements for new Schemes intended to help identify defects; and more. Observations discussed below are based on the Bills as introduced, and relevant sections may be…

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Forced sales (Strata renewal)

By | Strata Reform, Strata Schemes | No Comments
I was recently asked about forced sales in strata, enabling blocks to be redeveloped with less than unanimous consent. An associate of a developer encouraged a Lot Owner to fall into line with a proposed redevelopment and agree to sell his unit, claiming that the redevelopment was pretty much a done-deal because of agreements already in place with other owners - and the new legislation. Understandably, having heard reference to the strata reform and a new process for managing collective sale and renewal, the Lot Owner was quite concerned. The arguments for and against this reform – not so clear...
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