If you own, are buying, or are planning to invest in a property within an owners corporation in Victoria. you have likely encountered the term owners corporation.
Many property owners want to understand what an owners corporation actually does, how it affects their property, and what responsibilities come with being part of one.
If you’re also comparing how it differs from other structures, see our guide on owners corporation vs body corporate vs strata management.
Understanding how an owners corporation works is important because it plays a central role in managing shared property, maintaining buildings, and ensuring that shared communities operate smoothly.
Key takeaways:
- An owners corporation manages shared property in a subdivided development, handling maintenance, disputes, and protecting owners’ interests.
- It oversees finances, insurance, and compliance with Victorian legislation such as the Owners Corporations Act 2006.
- When you own a property in a strata development, you automatically become a member of the owners corporation with both rights and responsibilities.
What is an owners corporation in practice?
An Owners Corporation (OC) is a legal entity responsible for managing and maintaining the common property of a subdivided building or land.
An owners corporation is created when a plan of subdivision that includes common property is registered with Land Victoria. This commonly occurs in developments such as apartments, townhouses, commercial buildings, and mixed-use properties.
The role of an owners corporation is to:
- manage common property
- enforce rules for the development in accordance with Victorian legislation and established OC rules
- administer finances and insurance
- coordinate maintenance and repairs
- resolve disputes between lot owners when necessary
The term “owners corporation” replaced the former term “body corporate” following the introduction of the Owners Corporations Act 2006 (Vic).
The legislation established a formal governance framework for managing multi-occupancy developments across Victoria.
Functions and responsibilities within an owners corporation
The governing entity responsible for shared property carries several important legal and operational responsibilities to ensure buildings are maintained and managed effectively.
These responsibilities are governed primarily by the Owners Corporations Act 2006 and the Owners Corporations Regulations 2018.
Standard functions of an owners corporation include
- Repairing and maintaining common property, including structural elements of buildings.
- Maintaining essential services and complying with Essential Safety Measures required by the Victorian Building Authority.
- Arranging appropriate insurance, including mandatory public liability cover.
- Managing financial administration and collecting owners corporation fees.
- Organising meetings and maintaining records such as minutes, financial statements, and correspondence.
- Providing owners corporation certificates when requested during property transactions.
- Enforcing owners corporation rules and managing dispute resolution between owners.
Effective management of these responsibilities helps ensure buildings remain safe, compliant, and well maintained.
Many Committees discover that overseeing these responsibilities can become complex, particularly in larger developments or buildings with mixed residential and commercial use.
In these situations, seeking independent advice can help ensure the owners corporation is operating effectively. Strata Management Consultants regularly assist Melbourne owners corporations and Committees reviewing their current management arrangements or transitioning to a more suitable strata manager when improvements are needed.
Responsibilities based on the size of the development
The legal obligations of an owners corporation vary depending on the size of the development.
For example:
- Two-lot subdivisions are exempt from many formal requirements.
- Larger owners corporations face additional obligations.
Owners corporations with more than 100 lots or annual fees exceeding $200,000 must:
- prepare a maintenance plan
- conduct annual financial audits
- obtain building insurance valuations every five years
These measures help ensure long-term financial planning and proper building maintenance.
Governance structure
An owners corporation typically operates through a structured governance framework.
This includes:
- All lot owners, who collectively form the owners corporation.
- A Committee, elected by lot owners to assist with decision making.
- Delegates or managers who may be appointed to carry out administrative duties.
The Committee may also appoint a manager, employee, or other delegate to assist with day-to-day operations.
Do I have to be part of an owners corporation?
If you own property within a development affected by an owners corporation, membership is automatic.
This commonly applies to:
- apartments
- townhouses
- unit developments
- commercial strata properties
- mixed-use developments
In Victoria, an owners corporation is formed whenever a subdivision creates common property.
Common property may include areas such as:
- gardens
- foyers
- lifts
- driveways
- pathways
- car parks
- swimming pools
- shared walls or building infrastructure
Because these areas are shared by multiple lot owners, they must be managed collectively through the owners corporation.
Many owners corporations choose to engage a professional owners corporation management company to help manage these responsibilities. If you’re comparing providers, learn more about our owners corporation management services.
What are my rights and responsibilities as an owner?
Under the OC Act, lot owners have both rights and responsibilities.
Owners generally have the right to:
- access owners corporation records
- attend meetings
- vote on decisions affecting the property
- nominate or run for a position on the Committee
At the same time, you are responsible for:
- paying owners corporation fees
- complying with the rules of the development
- maintaining their own lot
- ensuring tenants comply with applicable rules
Owners also have an obligation to notify the OC of certain changes that may affect common property or building compliance.
Decision making within a strata scheme
Decisions within a strata scheme are typically made through formal resolutions.
There are three primary types:
Ordinary Resolution
Requires a simple majority of votes to pass.
Decision Making Within an Owners Corporation
Decisions within an owners corporation are typically made through formal resolutions.
There are three primary types:
Ordinary Resolution
Requires a simple majority of votes to pass.
Special Resolution
Requires 75 percent of eligible votes.
Used for significant decisions such as setting annual fees or approving major expenditure.
Unanimous Resolution
Requires 100 percent approval.
This applies to decisions such as altering lot entitlements or selling common property.
These voting structures ensure important decisions are made collectively and transparently.
So, what is owners corporation management?
Owners corporation management refers to the administration and governance of a strata development. You can also read our guide explaining what strata management involves in practice.
This includes coordinating financial management, maintaining common property, ensuring compliance with Victorian legislation, and supporting the Committee in making informed decisions.
When managed effectively, an owners corporation helps protect property value, maintain shared infrastructure, and support a well-functioning community.
However, these outcomes depend heavily on the quality of management overseeing the building.
Why effective owners corporation management matters
An owners corporation plays a critical role in maintaining shared property, managing finances, and protecting the long-term value of strata developments.
When managed effectively, Committees can focus on important decisions while maintenance, compliance, and communication are handled properly.
However, if strata management is not performing as expected, buildings may experience delays, governance issues, or poor communication.
If your Committee believes your current management is not providing the support your building requires, it may be time to review your options.
Our Consultants regularly assist Melbourne owners corporations with assessing their current management arrangements and guiding Committees through smoother transitions to better-suited strata management.
To learn more about your options, speak with the team at Strata Management Consultants today.
Call 03 9007 2618 or contact our team for independent advice.
