What you need to know if you’re buying or selling a strata titled property

Whether you are considering buying into a strata complex or selling out of one, there are a number of things to consider

Sjanna Sandalova

Strata title in Western Australia is the legal ownership of a 'portion' of a building or structure which can apply to units, townhouses, villas, commercial offices, factories, warehouses, retail shops, etc.

Essentially, owning a strata title means you not only own your unit or apartment, but you also share in the ownership of the common property and land the complex sits on.

Whether you are considering buying into a strata complex or selling out of one, there are a number of things to consider as well as obligations to follow.

Information for sellers

A requirement under the Strata Titles Act 1985 sets out that you as the seller of a strata lot or survey strata lot must give the buyer certain information before they sign the contract of sale.

This information is included in a Precontractual Disclosure Statement which can be downloaded from the Landgate website.

When preparing for sale, it is important to get on top of this early and have the following information/document's ready to go:

Your name and address as the seller.
Scheme notice, scheme plan, scheme by-laws (including those not yet registered) and schedule of unit entitlements.
The name and address of the strata company.
Strata lease documentation for the lot, if it is a leasehold scheme.
Minutes of the most recent annual or extraordinary general meetings and the latest statement of accounts.

In circumstances where this information can't be obtained, for example where the strata company does not keep minutes of its meetings, you must provide a statement outlining why these documents are not available.

In addition, you can prepare even more by giving any extra information that could be beneficial to the prospective buyer and be ready to answer the following questions:

Do you know what is happening in your strata scheme?
Is there major works occurring?
Is the complex looking well presented?
Are levies going up or going down?

Information for buyers

Under the new strata laws, prospective buyers will benefit from more detailed information which provides a clearer picture of the conditions of the strata scheme.

Information should include:

Agreed expenditure - estimated contributions you as the buyer will have to pay in the 12 months after settlement.
Obtain a copy of the annual general meeting minutes to understand the financials, maintenance and other items that are happening in the strata scheme. If this can't be provided (ie no meetings or small scheme etc) then the seller must provide confirmation as to why.
A statement of accounts of the strata company.
Any debts owing against the lot to the strata company.
By-laws and any additional by-laws must be read as they can affect what you can and can't do.
Information about any termination proposal received by the strata company.

However, so you can make an even more informed decision prior to purchase, it is crucial that you read through the documentation thoroughly, as well as be educated on the following:

Understand the differences between the various types of strata property so you can be informed on buying into the right strata for you.
What are you buying? Obtaining a copy of the strata plan and the unit entitlement so you can ascertain your ownership. For example, do you own your full building, inner surfaces etc?
Read through the unit entitlement so you can understand your portion of the strata company costs.
Do your research before buying off-the-plan and understand the requirement for additional disclosures. Make sure to discuss this with your agent.

Benefits of using a REIWA agent

Strata can be a complex component of real estate and there are far more things to understand compared to a stand-alone property.

Utilising the services of a REIWA agent can help streamline the above processes and ensure you have the best possible outcome for selling or buying a strata title.

Find a local REIWA agent to being your strata journey.