Strata 101:
What to ask your agent when purchasing a strata or community titled property

As you navigate the real estate market in Newcastle, you might consider a strata or community-titled property. Whether you’re a first-time buyer or an experienced investor, purchasing a property under this title comes with certain criteria that should be considered. To ensure you make an informed decision, asking the right questions when working with your real estate agent and conveyancer is crucial. Here are some essential questions to pose.

What are the quarterly levies?

Quarterly contributions paid by lot owners can vary significantly from one property to another and should be a consideration as part of purchase. It’s important to understand what these fees cover, including maintenance of common areas, insurance, day-to-day operating expenses, and any amenities owned by the Owners’ Corporation or association (common property can extend to include structure of lots in the development, roads, swimming pool, etc).

Are there any pending special levies or major works planned?

Special levies can arise for unanticipated largescale building repairs, improvements or defect rectification. It’s important to know if any are pending or if major works are planned and how these might be funded (e.g. cash in bank of scheme or otherwise), as these can affect your financial obligations as a lot owner. If you are considering purchasing a relatively new building, it is important to understand who the builder and developer are and what their track record is like.

What is the Capital Works Fund Balance?

Ask about the current balance of the Capital Works Fund (formerly known as the sinking fund) and whether there are any plans for future contributions or expenditures. It is also important to ensure that the Owners’ Corporation has a relatively up-to-date Capital Works Fund Forecast (CWFF) and whether the owners have contributed towards the fund in accordance with the suggested amounts in the CWFF.

What are the by-laws and rules of the strata scheme?

Each scheme has its own set of registered by-laws and rules governing residents’ behaviour and the use of common property. Ensure you understand these regulations and how they may impact your lifestyle and property usage. By-laws and rules of note might relate to pets, parking and renovations.