If you’re considering replacing your current owners corporation manager, this guide explains the key considerations before making a decision.
Replacing your current manager needn’t be complicated, having said there are processes, considerations, and legislation that needs to be followed.
Key Takeaways:
- Changing strata managers requires majority support from owners, ensuring that the decision reflects the collective interests of the corporation.
- It is essential to review the existing management contract and be guided by the Owners Corporation Act to mitigate potential legal or financial risks.
- Careful selection of a new manager is critical to addressing the building’s requirements and safeguarding the corporation’s funds.
What should an owners corporation consider before replacing its manager?
Committees sometimes want to act in haste or go in one direction but we think this guide is pretty detailed and helps explain the process of replacing your current manager. It’s not exhaustive but we think a pretty good starting.
1. Start by speaking with key owners and Committee members
Owners Corporation in Victoria is the collective of owners, investors, and owner-occupiers of that building.
Most owners corporations in Victoria have appointed and employed a professional and paid owners corporation manager or owners corporation management company. When it comes to answering how to change strata managers, the decision and choice are entirely that of the owners corporations. It’s your building after all.
2. Confirm majority support from owners before proceeding
When considering replacing your current manager, start by understanding what the majority wants.
Where there is a strata management Committee then, typically, the decision to transition strata managers will be that of the majority of the Committee [pending several other factors].
Where there is no Committee then, typically, the decision to transition strata managers will be that of the majority of the owners.
3. Understand strata managers’ contracts and owners corporation legislation
Before replacing your current manager, you’ll need owners and Committees to consider the following facets of strata law and legislation:
- Contractual obligations – what does the last signed strata management contract binding the owners corporation to the strata manager say? What are the terms and conditions? i.e. if the strata management were to be changed to another services provider.
- Strata legislation – the primary piece of statute law governing owners corporations and strata management in Victoria is the Owners Corporation Act 2006. However also worthwhile understanding these amendments and updates to Act that may be relevant.
- Case law – owners corporation matters and disputes are resolved through the Victorian Civil & Administrative Tribunal. Matters and disputes revolving around the termination, sacking, changing, and exit of strata management services can sometimes be presided over and decided by a VCAT Member. As such there are numerous VCAT cases and legal precedents that may be relevant to you when it comes to changing strata management services.
4. Define what your building and owners corporation actually need from a new manager
Our viewpoint in this regard is that you are seeking management services for:
- The building itself; and
- The collective of owners i.e. all the tenants, residents, owners, and investors
Buildings have their requirements and areas to address. More established buildings will require a lot more attention to maintenance plans, raising maintenance funds, and addressing issues before they get worse or become a safety issue. Where in newer buildings, the overarching priority for owners, Committees, and strata managers should be about building defects (in Victoria you have six years to claim structural defects and two six years for non-structural).
Owners and Committees are also going to have different demands from their strata manager. This requires consideration and mapping out.
5. Choose a new strata manager who won’t repeat the same problems
In Victoria, there are over 90,000 owners corporations – comprising over 1,000,000 owner-occupiers and investors.
With regards to strata managers in Victoria, there is overwhelming an and staggering growing list of 1,300 strata managers. Some strata managers are established, some are real estate agents, and then there are a lot of one-man shows who don’t know much about strata or accounting…
Strata managers your building but also your money and funds.
Thinking about replacing your current owners corporation manager?
To learn more about how to change owners corporation manager or specifically, what is strata management? Visit Strata Management Consultants today. Strata Management Consultants Melbourne are strata experts working with owners when it comes to changing strata managers. Furthermore, we have a panel of Qualified & Approved Strata Managers. We don’t work with every single out-strata manager out there but our management companies are some of the best body corporate management companies in Melbourne.
To learn more about the manager selection and transition process, feel free to contact us at 03 9007 2618.
