Following strata reforms in other states, Victoria is currently reviewing the regulatory regime and considering changes to its own strata laws. It is likely that some of these changes will be modelled on reforms that occurred elsewhere, such as in New South Wales.
Many of the changes, if adopted, will improve the rights of strata residents, affect certain processes in the buying or selling of strata properties and give owners’ corporations more power and control over maintenance and safety decisions. Below we look at some of the other potential changes affecting buyers and sellers.
Developers may have to place a bond of two per cent of the total value of the building to cover potential defects following the completion of the project. This will help better protect buyers of new units, especially first home buyers, creating more confidence in the industry and force bad developers to adopt better due diligence.
Owners of new apartments who find defects will no longer have to face the prospect of accepting them and paying for the necessary repairs themselves or deal with the cumbersome prospect of pursuing developers through the courts, some of whom tend to disappear as soon as the last unit is sold.
The NSW reform which allows 75 per cent of lot owners to ‘force’ the sale of the remaining 25 per cent of a project may be adopted in Victoria. Under current legislation, the requirement is for a 100 per cent vote in favour of sales of this nature.
The idea is to stop individual owners from preventing the redevelopment of their aging and high maintenance unit blocks or holding their neighbours for ransom by demanding or holding out for an inflated price.
Another change may involve lifting the eligibility requirements for strata managers. This includes restricting developers of projects from getting appointed as strata managers following the completion of the project.
During the review of consumer property law in Victoria between 2015-16, a range of issues involving the conduct of strata managers were examined. The changes aim to streamline the way strata managers make decisions and resolve disputes while protecting resident rights.
NSW reforms introduced a three-tier permissions scheme that allows some minor work to be carried out without permission, while some significant renovations can be carried out with a simple majority and major renovations, particularly those affecting common property, being subject to the usual restrictions, bylaws and special resolutions.
The idea aims to make it easier for strata owners to live in a home that suits their needs and style without having to go through a long winded process involving strata managers and lawyers for every little change you want to make.
Some other changes we might see involve rights surrounding pets, smoking and overcrowding. Until a bill is announced, buyers and sellers must simply wait to see. It is in all likelihood however, that any changes will bring Victoria in line with the other states.
If you need assistance with property conveyancing in Melbourne or property law advice in Victoria, talk to the experienced team at Just Conveyancing. Contact us online or call us on (03) 8580 2276 today.