Have you just purchased your own apartment? Or perhaps you’re simply looking into making this major purchase; regardless of which exciting boat you find yourself in, it’s time to acquaint yourself with Strata. A Strata scheme is a system that handles the legal ownership aspect of a building. In essence, this means, you share a building with the other tenants and together you make up ‘the owner’s corporation’ making you responsible for the maintenance of the shared communal areas.
So, where exactly are these communal areas, and how high will these costs be? Here, we break down what exactly Strata management fees are, and how you can better understand yous.
What Kind Of Fees Does Strata Entail?
So, what do your Strata fees actually go towards? To break it down, Strata management falls into three different categories, administrative fund levies, sinking fund levies and special levies. Here, we break down exactly what that means and exactly what you’re paying your body corporate management for.
Administrative Fund Levies
The administrative fund levies aspect of the Strata scheme refers to the daily costs that your body corporate fees would contribute to. This includes such maintenance as gardening and cleaning, as well as minor repairs that are needed around the communal areas of the building. This fee doesn’t tend to change much, however as prices increase yearly, they will steadily increase.
Sinking Fund Levies
The sinking fund levies tend to cover larger expenses. These can fall into two different categories. Firstly, there are anticipated costs, such as building wear and tear, like repainting walls, fixing a broken roof or replacing old carpets. But, then there is the second category in which your strata management fees cater, these are the unanticipated expenses. However, if your building is new then there usually won’t be many unexpected repairs that arise.
Finally, there are the special levies. Whilst the sinking fund is there to generally fund larger expenses and a few unanticipated repairs, there are of course issues that it doesn’t cover. Paying this fee is likely the least popular as people tend to prefer to only pay for things that they know need attending to, but if there is an additional problem that urgently needs attending to, it’s better to have the money to fix it in advance, rather than be unprepared and have to come up with the money last minute or just let the issue grow larger than necessary.
How Much Are Strata Fees And Do You Pay For Them When You’re Renting?
The good news for renters is that you will not be paying any Strata fees, these are paid exclusively by the owners or part owners of the building. In terms of cost, there is no set payment. Whilst you can break down what your payment will be going towards, there is no concrete number. Strata cost is dependent on a number of factors such as the location and size of the property, as well as the location. As well as this, if your apartment complex has more amenities such as a communal gym or pool, your fees will be higher as they will go towards these luxuries that your building houses.
Whether it’s simply to maintain the outdoor area of your building or to manage unprecedented damage, paying your levies is an essential contribution to keeping your apartment complex up to a high standard of maintenance. These fees are an investment in your home and your lifestyle and will maintain the value of your building as time goes on, so they are an incredibly worthy cost for you to contribute towards.