Strata Title vs Community Title in NSW

Strata Title vs Community Title in NSW

Strata title and community title are both forms of property ownership used in New South Wales, but they operate differently and can create different rights, responsibilities and ongoing costs for owners.

Understanding the type of title involved is important before purchasing a property because it can affect what you own, the property you share with others, the rules applying to the scheme and the levies you may be required to pay.

What Is Strata Title?

A strata scheme divides a building or group of buildings into individual lots together with common property.

Strata title is commonly used for apartments, townhouses, villas and some commercial developments.

When you buy a strata lot, you own the lot identified in the strata plan and also have an interest in the common property shared with the other lot owners.

Common property can include areas such as foyers, stairways, lifts, gardens, driveways, roofs, external walls and shared recreational facilities, depending on the particular scheme and strata plan.

The Owners Corporation

All owners in a strata scheme automatically form part of the owners corporation.

The owners corporation is responsible for matters including the management and maintenance of common property, insurance, financial administration, levies and the administration of the scheme’s by-laws.

What Is Community Title?

A community title scheme is a form of land development that allows separately owned lots to share property known as association property.

Community schemes can be used for larger residential, commercial or mixed-use developments and may include shared roads, gardens, security facilities, recreational areas, swimming pools, marinas or other common facilities.

A community scheme can also contain subsidiary precinct, neighbourhood or strata schemes, allowing more complex developments to be managed through different levels of ownership and administration.

The Community Association

Owners within a community scheme are members of the relevant association.

The association owns and manages the association property and is responsible for matters such as maintenance, administration, insurance, levies and compliance with the scheme’s management statement and by-laws.

Key Differences Between Strata and Community Title

• Type of development: strata is commonly used where individual lots form part of a building or group of buildings, while community title can be used for broader land developments containing shared facilities and multiple subsidiary schemes.
• Shared property: strata schemes have common property, while community schemes have association property.
• Management body: strata schemes are managed through an owners corporation, while community schemes are managed through an association.
• Rules: strata schemes operate under by-laws, while community schemes operate under a management statement containing by-laws and other scheme provisions.
• Levies: owners may be required to contribute to expenses associated with the management and maintenance of shared property.

Can a Property Be Both Strata and Community Title?

Yes. A strata scheme can exist within a larger community scheme.

In that situation, an owner may have obligations arising from the strata scheme as well as obligations associated with the broader community scheme. This can mean more than one set of levies, rules and management arrangements applies.

What Should You Check Before Buying?

Before purchasing strata or community title property, the contract and relevant scheme documents should be reviewed carefully.

Depending on the property, important matters can include:

• the strata, community or neighbourhood plan;
• by-laws and management statements;
• current and proposed levies;
• financial records and available funds;
• insurance arrangements;
• planned repairs or major works;
• building defects or disputes;
• restrictions affecting renovations, pets, parking or use of the property; and
• any additional obligations arising from subsidiary schemes.

Strata and Community Title Conveyancing

Russell Kelly & Associates assists buyers and sellers with strata, community title and other NSW property transactions.

We can review the contract, title and relevant scheme documents and advise on issues that may affect the proposed purchase or sale.

Learn more about our Property Law and Conveyancing services. For property owners and purchasers in Norwest and nearby communities, see our Hills District property lawyers and conveyancing page.

Contact us to discuss your property transaction.

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This information is general in nature and should not be relied upon as legal advice. The rights and obligations applying to a particular strata or community title property depend on the registered plans, scheme documents and circumstances.