The concept of strata is explained in easy term

The concept of strata explained in easy terms – and 5 things you may not have known

What exactly is strata?

When you think of the term ‘strata’, you might think about rock formations in layers, or stratus clouds. And really, you wouldn’t be far off understanding how this term applies to property, because strata basically means layers or levels.

It’s a term that’s frequently used in the property industry, and is essentially a shorthand term that refers to a multi-level building. The layering concept comes in when you think about your typical block of flats, as the units or apartments are generally located on different levels, or ‘strata’.

Strata refers to more than just the appearance of a building, however. Strata title is a form of ownership structure that’s specifically designed to work with the nuances of multi-level apartment blocks and horizontal subdivisions.

A strata title scheme relates to a building or complex that has been divided into individual lots owned by individual owners. This allows someone to own an individual unit or apartment, as well as to maintain shared ownership in the rest of the property (what’s known as the common property).

Common property can include gardens, driveways, roofs, car parks, entrances and lobbies, lifts, pools, gyms, stairwells, courtyards and post boxes – to name just a few. The entire scheme is managed by what’s known as a body corporate – a legal entity that ensures appropriate management of the property as a whole.

So, essentially what this means is that when you buy an apartment or unit, you also buy part of a strata title. You alone will own your individual unit, plus you will also own a relatively equal share of the building and its facilities and common areas.

All the owners together are responsible for funding maintenance and upkeep of common areas; while you alone are responsible for your own apartment or unit. This allows people to live amongst a community without having to carry out all the work involved in owning your own freestanding property.

As well, a strata scheme allows more people to fit into a smaller area than individual house ownership does.

Five things you didn’t know about strata

Now that you know what the concept of strata means, here’s five things you didn’t know about strata.

1. The concept of strata, while practiced worldwide, was initiated right here in Australia in 1961.

2. ‘Strata title’ is a term that was first coined in New South Wales, and was a way to manage the legal ownership of apartment blocks. The term first came into use when the New South Wales Parliament passed the Conveyancing (Strata Titles) Act of 1961. Before this time, it was a clumsy, unmanageable and inconvenient process to own a single unit within a larger complex, as individual owners did not enjoy

separate ownership of their unit. This became a huge problem for those looking to buy units, as banks and lending institutions were reluctant to lend them money, and interest rates were higher than for houses. Strata Title solved this problem, with this solution making it easier to borrow money for unit or apartment ownership. Thanks, New South Wales government!

3. This new strata concept gradually spread to all the other Australian states who could see the benefits of its use, and eventually to New Zealand, Canada, Singapore, Indonesia and many other countries. Today it’s widely used worldwide.

4. There are now more than 270,000 strata schemes operating Australia wide, making it one of the most popular forms of home ownership – that’s over two million individual lots!

5. While all states have embraced strata title, the legislation varies from state to state. Each state operates under its own specific strata legislation, and the terminology and regulations may be different from state to state as well. Don’t assume that something that applies in one state will automatically apply in another. That’s why it’s important to get strata advice that’s specific to your state. For advice from the best strata managers in Queensland who have vast experience and expert local knowledge, get in contact with the leaders in strata management, Capitol BCA, here: