Historically, first-home buyers have purchased a house (or land) in the suburbs; however, with the ever-changing socio-economic landscape coupled with housing affordability issues, as well as the shift towards easy-care low maintenance living – an increasing number of buyers are purchasing properties in a community titles scheme, i.e., townhouse, unit, or apartment.
What is a strata title?
Strata title is a method of facilitating individual ownership of part of a lot/unit whilst sharing ownership of the common grounds on which it is built. There are now more than 340,000 strata title properties nationally, providing close to three-million homes across Australia.
If you are considering purchasing buying into a strata title scheme, there are certain things you need to understand prior to executing the contract.
Firstly, the benefits:
- Affordability – this type of property is generally (not always) priced closer to an entry level or downsizers budget.
- Location – generally (not always) they are located within close proximity to major amenities within a CBD or regional area.
- Low maintenance – almost always they require less maintenance than a stand-alone property on its own block, upkeep is easier, and they can work well in a ‘lock and leave’ situation when off travelling.
Things to be aware of:
- Your ownership includes your individual unit/apartment/townhouse as well as sharing ownership and responsibility of the Common Property.
- You are automatically a member of the Owners Corporation, therefore partly responsible for the Common Property.
- You will need to regularly contribute to the cost of running the building by paying Strata Levies in addition to rates and taxes for your property.
- Compared to owning a freestanding house, there could be lifestyle restrictions imposed, i.e., by-laws revolving around a number of issues from where you hang your washing, where you can park, and whether or not you can have a pet.
- Owner to tenant ratio – this can be an important factor when it comes time to sell, some buyers, particularly owner-occupiers are wary of purchasing into an investor-dominated building.
Here at Wright Place, we sell many strata titled properties and have expert knowledge on all the benefits and potential pitfalls of buying into such a scheme; we offer full disclosure prior to any contract being exchanged.