Anyone who has owned an apartment with a dysfunctional body corporate or a difficult co-owner will know how frustrating that can be. New strata laws just introduced by the NSW state government may change all that. It may even create new opportunities for unit owners as well as brighten up some old and dated architecture.
Previously it required 100% agreement to implement any major changes through a body corporate. It is rare to ever get total agreement with any group of people so renovations or upgrades to apartment blocks were often put in the too-hard basket. Yes, there will be a downside for some elderly owners wishing to see out their days in the unit they have lived in for many days. An ombudsman service will still be available for certain cases.
As a result of a little known “renewal” clause in the imminent strata law changes that came into effect on November 30, it will be much easier for owners to organise to redevelop their buildings themselves, in partnership with a developer or financier, or to allow a developer to completely upgrade their blocks.
“This opens up so many possibilities for apartment owners,” says Sydney apartment owner and businesswoman Catherine Lezer, who is also a director of the independent not-for-profit Strata Community Australia. “It’s about proactively managing the value of your apartment asset. Before, it was difficult to organise and to finance. Now both are possible.”
“We’ve had some apartment owners talking about participating in the development themselves, for instance putting balconies on to their apartments or stripping out their old buildings and just rebuilding on the core,” says Lannock CEO Paul Morton. He has just finished negotiating finance to enable a number of new redevelopment plans to go ahead after November 30. Loans tend to range for $5000 to $5 million over the longest 10-year period. “We’ve seen a spike in inquiries from apartment owners and strata managers seeking finance for strata renewal projects,” he says. “Their shabby ’70s unit is now a potential gold mine.”