Strata management, sometimes known as "body corporate management", is a specialist area of property management involving the day-to-day operation and management of a property that is jointly owned and comprises multiple units, common areas and common facilities. It is derived from an Australian concept of property law called strata title applied to the administration of common ownership in apartment buildings on multiple levels, or strata. Emerging markets in Dubai, Abu Dhabi, the Philippines and India have adopted the Australian system. It is one of the fastest growing forms of housing in the United States today, similar to common-interest development (CID), a category that includes planned unit developments of single-family homes, known as homeowner associations (HOAs), condominiums, and cooperative apartments.
The successful management of such developments requires the establishment of a strata title system to provide a framework for ownership, and guidelines to manage developments with multiple users and owners.
Many jurisdictions adopt the concept of jointly-owned property. Owners in these types of schemes automatically become members of an owners' or community association. These associations ultimately bear responsibility for the maintenance and management of common areas such as lobbies and corridors, and shared leisure facilities such as swimming pools and gyms. They are also responsible for running the administrative and financial aspects of the property.
The strata manager's role is to work with the owners' corporation and executive committee to successfully control, manage, maintain and administer the property and to create an appropriate community environment and includes tasks such as:
General accounting
Budgeting
Invoicing of levies/service charges
Arrears collections
Financial reporting
Contract management
Meeting preparation
Communication with property stakeholders
Coordination of maintenance tasks
Enforcement of rules/by-laws
Issuance of notices, orders and certificates
General secretarial tasks
Body corporate fees
Body corporate fees (also called levies) are a mandatory part of strata living. These fees are payable to the body corporate or strata company managing the property, enabling them to take care of things such as insurance and maintenance of common areas.
Essention
If a home or investment property have a strata title or governed by a body corporate (under law, must be formed the body corporate or an owners' corporation and every unit owner must be given membership), some areas will be collective, and need funds for upkeep that must be paid every year. If these fees are not paid, single owners lose the right to vote on all matters that require an ordinary resolution. They can still attend meetings and vote on matters, if they require a special or unanimous resolution. The body corporate can award interest on delayed fees and may apply to the court for recovery unpaid money.
Body corporate fees cover everything from building insurance and maintaining common areas, through to shared utilities, building works and repairs. The total amount is budgeted each year, and then divided up between the unit owners.
In Australia, in a rental property the landlord may collect a body corporate fees as an outgoing in some circumstances. The retail leasing legislations vary in content across state/territory.
House maintenance costs
Stephen Raff wrote in his book, The Body Corporate Handbook: A Guide to Buying, Owning and Living in a Strata Scheme or Owners Corporation in Australia that the only difference between body corporate fees and house maintenance costs "is that if you have a house you will have a little more control over the timing of the expense."
Calculation
Body corporate fees for each year is budgeted, and then divided up between the unit owners. The fees calculated by the body corporate will be presented at AGM, and decided by a majority vote. The quarterly levies payable by each unit owner will then be calculated.