Does the Strata Management Machine Need Fixing?

or, if strata management was an old car what would you do ...

A Quick Read

If you had a 50-year-old car, would you expect it to keep working well in modern traffic conditions? Obviously not. So, in this article, I use a motoring analogy to ask whether the strata management machine needs fixing; if so, what kind of fixes; and the issues that may impact the fixes.

After that, there will be a series of interesting articles by strata stakeholders outlining how they each think the strata management machine should be fixed.

[a 9:50 minute read, with 1,869 words]

The Full Article

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INTRODUCTION

Like an old car that has spent countless years on the road, Australia’s strata building management business sector has carried strata owners, investors, residents, and others along a fun but sometimes bumpy journey for more than 50 years.

At first glance, a vintage or classic automobile may strike some people as picturesque or even charming and trigger their nostalgia for the old days of motoring. But under the bonnet wiring, gears, cogs, pipes and more are wearing out, engines fall out of tune, misfire or worse, parts of the chassis could be riddled with rust, and the bodywork and trim starts looking shabby.

Over time, limited maintenance or neglect can leave that once-proud vehicle sputtering along, increasingly vulnerable to breakdowns that leave the driver and passengers stranded, causing congestion on the roads or, even worse, becoming involved in accidents.

In similar ways, the strata building management sector [that’s responsible for an ever-growing number of apartment complexes, townhouses, and mixed-use developments] may appear serviceable from the outside, yet is creaking under the strain of modern needs and expectations and unable to deal with a heavy load or emergency situation as it ages.

So, what kind of fixing is needed to keep the strata management machine running well into the future?

Is it just another tune up, some minor repairs, a few upgrades, an engine overhaul or a full restoration?

A COMPLEX MACHINE WITH MANY MOVING PARTS

Just like an old car with complex mechanicals, the strata building management sector is an intricate network of interdependent components that need to operate together.

There are strata buildings, committees, owners, residents, investors, strata managers, property managers, building managers, technical and professional advisors, suppliers of goods and services, and non-owner residents all playing their roles. Each of these people and groups have rights, responsibilities and vested interests. When every part is well-maintained and functioning in harmony, strata buildings run smoothly: gardens are kept tidy, shared facilities are clean and accessible, disputes are promptly resolved, and budgets remain in check.

But, as anyone who has maintained an older vehicle knows, wear and tear are inevitable.

In strata buildings, that wear might manifest in outdated by laws or rules, poor maintenance and repair planning, inflated budgets and strata levies, inadequate communication or secrecy, or conflicted interests.

The more complex the strata building, the more things can go wrong. Minor management oversights can become major financial or legal headaches for strata owners and residents down the track.

TINKERING VERSUS OVERHAULING

If the strata building management system is akin to an old car, the question becomes whether it’s time for minor tinkering [like new spark plugs and points], or whether the drivetrain and chassis needs a complete overhaul.

Some strata industry insiders and commentators argue that the sector simply needs updated regulations, better communication channels, and the adoption of new technologies to enhance transparency. Others believe more fundamental reforms are required: akin to dropping in a brand new engine and gearbox.

New legislation in some Australian states has sought [and continues] to modernise strata building management and operations, demanding greater accountability from strata managers, building managers and committees. For example, reforms that require clear disclosure of conflicts of interest or stricter guidelines for how sinking funds (long-term maintenance funds) must be managed. These might be seen as oil changes or valve adjustments: changes that keep the system running but do not entirely rebuild the vehicle.

GROWING PAINS OF AN EXPANDING FLEET

Australia’s property market has seen significant growth in multi-residential developments over the last decade, especially in major urban centres like Sydney, Melbourne, and Brisbane.

More people than ever are living in strata-titled properties, from high-rise towers to suburban townhouse complexes. That expansion is not unlike an auto manufacturer releasing more versions of a successful model: there are more cars on the road, more service stations and mechanics are needed, and more variety in what needs fixing occurs. As strata buildings multiply, the demand for strata and building management businesses has increased, and so have their responsibilities.

But as the ‘fleet’ of strata buildings grows, management systems that worked effectively for smaller, simpler developments or for smaller strata building portfolios in the past can begin to break down in larger or more complex buildings or when there are more and more of them. Issues such as short-term letting, building defects, and disputes over shared facilities become more common, leading to a backlog of conflicts and discontent.

Like an old car being pushed to haul bigger loads than it was ever designed for, the sector can strain under the added weight.

THE RUST BENEATH THE SURFACE

One of the most common complaints in strata building management is transparency or the lack of it.

Strata owners and residents often feel in the dark about where their strata levies go, why certain repairs take so long, or how decisions are made about large capital works and day-to-day issues. Meetings are poorly attended or, in some cases, not communicated or run effectively. And, strata owners feel disempowered.

Where transparency is poor, distrust grows, just as rust silently spreads under the paintwork of an older car.

Then there is the question of regulatory oversight. While each Australian state and territory has its own strata legislation, patchwork regulations can sometimes leave strata buildings vulnerable to poor or exploitative practices.

Strata managers are required to hold certain licences in some jurisdictions but not in others. Disputes may need to be escalated to tribunals, which can be time consuming and stressful. This legislative complexity can act like engine parts designed by different manufacturers; even if they technically fit together, they may struggle to function efficiently as a unit.

MODERN TOOLS FOR MAINTENANCE

Just as a mechanic working on a classic car can benefit enormously from modern diagnostic tools, strata management can also leverage technology to streamline processes.

Platforms that provide transparent budget updates, allow for digital voting, manage workflows, streamline communication or deliver automated reminders for strata building compliance can help strata owners and strata managers stay on top of things. Cloud-based and application style solutions can store documents securely, grant different levels of access for strata committees, owners and residents, and reduce administrative overhead.

Yet, technology is only part of the answer. It can help identify the weak points in the ‘engine’, but it cannot fix deep seated structural issues on its own. A shortcoming in legislation or a pervasive culture of complacency won’t disappear simply because a strata or building manager invests in a flashy new software system.

Instead, consistent, well-enforced regulations and a commitment to open communication must accompany technological adoption.

THE “MECHANICS” OF PROFESSIONAL STRATA MANAGERS

Strata managers in Australia often wear multiple hats: administrative professional, mediator, and project manager.

Like skilled mechanics, they must diagnose issues, propose solutions, and coordinate different stakeholders (from contractors and engineers to strata owners and residents). Professionalism and qualifications in this sector, however, can vary widely. While many strata managers bring extensive experience and a genuine commitment to good governance, others may lack the necessary training, experience, support or resources to navigate complex buildings effectively.

In some instances, unscrupulous strata management operators exploit knowledge gaps among strata committees and strata owners, charging inappropriate fees for minimal service or neglecting essential duties. Such practices are akin to a mechanic charging you for premium engine oil but pouring in cheap alternatives instead. This further erodes trust in the strata management sector, as strata customers feel uncertain about whether they’re getting genuine value or if they’re being taken for a high rise ride.

SHFTING GEARS: SUSTAINABILITY AND COMMUNITY NEEDS

If we look under the hood of contemporary strata living, sustainability features are increasingly part of the conversation.

Solar panels, electric vehicle charging stations, water saving technologies, and green rooftops are all in greater demand. However, implementing such features in established strata buildings is often more complicated than simply deciding to do it. There may be disagreements about funding, or building codes may require extensive studies to ensure structural integrity and compliance. This is similar to upgrading a vintage car with modern safety or performance enhancements; feasible and worthwhile, but costly and sometimes complicated.

Furthermore, strata owners and residents increasingly view strata buildings as more than just buildings; they are communities. As community living evolves, people expect amenities like gyms, swimming pools, shared gardens, co-working spaces, and more. Proper management of these facilities demands up-to-date skill sets, from knowledge of hygiene regulations to event organising. The strata and building manager of today must be part facility manager, part community liaison, and part compliance officer.

WHERE TO FROM HERE?

So, does the Australian strata and building management sector need fixing? The answer likely depends on perspective.

Some may argue that its foundations remain strong [like an old car with a sturdy chassis] requiring only a systematic tune-up in the form of updated legislation, better training, and increased transparency.

Others may maintain that the model is outdated and had become redundant, calling for an overhaul that reinvents how strata management is delivered and regulated across Australia.

What is clear is that strata living is not going away. High-density and multi-residential developments will only continue to grow in number as cities look for sustainable and efficient ways to accommodate expanding populations. Consequently, the business sector charged with managing these strata communities must evolve to handle greater complexity, higher expectations, and emerging challenges.

Like a classic car, the strata management sector has a certain enduring quality: it has proven itself roadworthy for many years, offering a framework for co-ownership and shared living that has sustained many good outcomes.

Yet the future likely requires more than sporadic maintenance.

To thrive, the strata management sector needs a combination of legislative support, professional development, technological innovation, and a cultural shift toward open, collaborative governance.

When all those elements align, Australian strata management will run smoothly; shifting gears with ease and carrying strata stakeholders forward into a better strata future.

SO, WHAT’S NEXT FROM GOSTRATA ?

This article poses questions and outlines potential issues.

But, I don’t profess to have the answers or that there is just one set of correct answers or appropriate actions. Rather, the views of the stakeholders hold those answers and solutions and hearing and considering them will deliver them.

So, over the rest of 2025, GoStrata Media will be featuring a series of articles by those strata stakeholders [including strata managers, suppliers of goods and services, non professional and professional advisors, regulators, owners, residents, committee members, developers, industry group leaders, commentators and pundits] outlining how they think the strata management machine should be fixed.

Hopefully, it will give us all a workshop manual for the strata management machine or a few manuals for the different models.

February 26, 2025

Francesco ...

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