The new strata law mean that different professional groups must understand how their roles will change, along with advice, processes and procedures.

Real estate agents


Protection of buyers

Every buyer of a lot in a strata titles scheme in WA should receive information about the scheme before they sign a contract (the offer and acceptance).

The upcoming changes will require real estate agents to ensure the right information is provided to buyers before they purchase a property.

Real estate agents will be required to:

  • Give the most relevant information to a buyer
  • Set out the information in a clear way
  • Make sure the buyer knows where they can get more information
  • Make sure the obligation on the seller to provide information is reasonable
  • Clarify on what grounds a buyer can avoid the contract if the seller fails to provide the information to the buyer

Leasehold Schemes

Real estate agents will need to fully understand the implications of a strata scheme being a leasehold strata scheme.

A leasehold strata title can be transferred and mortgaged just like a normal strata title, however the leasehold scheme is differently defined by having an expiry date. It’s predicted that the value of a leasehold strata lot will decline as the expiry date of the scheme approaches but it’s up to the market to determine the value of any lot just as it does with existing strata lots.

You will also need to understand how the underlying title of a leasehold strata scheme i.e. the title to the land which has been subdivided by the leasehold scheme, has a reversionary interest which can be sold or mortgaged similar to any freehold property.

Local Government


Approvals by Local Government

At present, some approvals for development and subdivision are provided by Local Government and Department of Planning, Lands and Heritage (DPLH).

It’s important that Local Government consults with DPLH on the updated approvals process. Approvals have changed and Leasehold Strata in particular needs to be understood by local planners and some guidance in this regard is provided in the proposed regulations.

All forms associated with strata schemes have been recreated using more modern language and terms. Local Government will need to seek updated versions from the appropriate website.

Local Government Rates

The method of calculation of rates has not changed with the Valuer General providing the GRV or UV for Local Government to calculate charges. This applies to leasehold strata lots in the same was as existing strata lots.

The council of a strata company


Councillors are supported in the changes to the Act with greater detail as to their role and how they are required to behave. You, as a councillor, may think it’s obvious that you should act honestly, with loyalty and in good faith and now the Act confirms this. There’s also guidance regarding conflicts of interest and how this should be handled.

Councillors are also protected from liability in specified circumstances as long as they are acting in good faith. For full details on councils refer to the Governance by-laws.

Conveyancers


As a conveyancer you will need to use new forms when dealing with a strata property and to be familiar with a statement of how each item registered or recorded for the scheme is to be dealt with.

You will also have to handle the transfer of leasehold strata titles so will have to be familiar with all the requirements of this.

Valuers


As a valuer your job will not have changed significantly in regard to the valuation of strata lots although the market and capital values of leasehold strata lots may require some deliberation.

The termination process, when a full proposal is required, will need to include a termination valuation report. The proposed regulations include what methodology is required to create this and also prescribes that the valuer may not be an associate of the proponent of the termination.

There is also new certification for a valuation required when determining that a staged strata scheme does not vary from the staged by-laws which define the values and unit entitlement of each stage. This certification, along with a similar one from a surveyor, both of whom can’t be an associate of the developer, will together determine whether existing owners in the scheme are required to approve the next stage of development.

Surveyors


The proposed amendments include significant changes for you as a licensed land surveyor.

  • Leasehold strata titles schemes
  • The requirement to obtain approval of a strata plan or amendment of a strata plan to give effect to a subdivision from the Planning Commission (or the delegated local authority)
  • Survey-strata plans are now subject to s.146 of the Planning and Development Act 2005
  • Amalgamation and disposal of common property being classed as a type of subdivision of the scheme
  • Terminations of schemes requiring subdivision approval from Western Australian Planning Commission (WAPC)
  • Information shown on the strata/survey-strata plan
  • Ability to create short form utility service easements, easements in gross and restrictive covenants
  • More flexibility for staged developments
  • Regulated strata forms to become approved forms
  • Changes to exempt from WAPC approval conditions
  • General changes in section and regulation numbers and terminology

You will be notified of all the changes through the usual channels and all this information will be available in the Strata Titles Policy and Procedure Guides on Landgate’s website.

Lawyers


The Strata Titles Act 1985 and supporting regulations have been extensively amended. This, together with the introduction of Leasehold Strata Schemes will require the legal profession to review the new law.

Banks


Leasehold

Banking institutions may consider providing mortgages over leasehold strata titles. There is nothing in the legislation which prevents a leasehold strata lot being mortgaged. If lending institutions decide to offer mortgages they will take into account the remaining term of the strata lease before calculating the amount of money available.

Staged Subdivisions

In many instances where changes are being proposed within a strata scheme all registered interest holders must provide consent to the changes. As mortgagees lending institutions like banks have 60 days to respond to the letter of notification of the changes. If no response is received in this time their consent is deemed to have been given. This is critical when staged subdivision by-laws are being changed as timing on developments is critical.

Additional information

Information Sessions

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