A new report from UNSW highlights the growth of strata units in the Australian housing market.
June saw the release of the most recent Australasian Strata Insights report detailing how strata living is changing across the nation.
The report, presented by researchers from UNSW, shows that 16 per cent of Australians now live in strata accommodation, and the industry represents $1.3 trillion of property value generating over $7 billion a year in associated maintenance and management fees.
However, despite the big numbers, information about the industry is still relatively thin on the ground and as such, the Insight report plays a key role in establishing the significance of strata properties to the nation and hopefully in government policy. Looking at the details, we can get an idea of not just the broad outlines of the industry but how its trends will affect individual schemes.
In terms of the demographic makeup of buildings, the report lists that lone people (39%) or couples without children (25%) occupy most body corporate properties. In comparison, just over a quarter are occupied by families or group households (26%). Meanwhile, almost half of apartment dwellers (48%) are aged between 20 and 39, while 17 per cent are over 60.
It’s interesting to consider how those groups might interact. Certainly, each segment will have different spending priorities, and yet they will have to come together to make group decisions over what levies to raise and works to undertake. As people come under more significant financial pressure, it’s worth asking if we have suitable structures for people to make those decisions without major conflict or if we should be looking to move the legislation forward to allow for new ways of decision making.
There are also different social behaviours to consider. An average level of sound for a family can be quite different to what is acceptable for a single older person. Young singles might not mind too much if their neighbour has some friends over on a Friday night, but how does this fit with the shift worker on the other side who has to get up at four am. Are our by-laws strong enough and flexible enough to accommodate these different societal groups living close to each other?
Empirical evidence would suggest that they are not. As the number of body corporate occupants grows, that will likely need to change, but it is not an idea that is on the agenda at the moment for most governments.
We also need to consider which groups the strata committees are drawn from. In Queensland, for example, there is a higher percentage of owners aged over 60 (23%) and empirically, we can observe that this population is more likely to fill the positions on committees. How does that affect the running of buildings in the state as opposed to, say, in NSW, where over 60s are just 15 per cent of strata owners? Every segment will have a different social and financial profile, and if you get specific sectors taking more control of committees, that will change how buildings run. The obvious question to answer here is how can we make strata more accessible to people whose lives may already be full of work and family commitments?
What are the stats for body corporate managers? We can see that nationally, 3,923 body corporate managers service 356,788 strata schemes at an average of 90 buildings per manager. Of course, not all schemes have managers. Two or three lot schemes, in particular, tend to self-manage, but just this raw data alone can give you the idea there may be more buildings than there are managers, and certainly, there are more buildings than good managers. With more developments being built all the time, that’s likely to be an issue for the industry moving forward.
The report has statistical breakdowns for each state. In Queensland, we can see that in 2022 there were 89,049 body corporate schemes totalling 1,043,690 units. An average scheme is about 12 lots, and for those schemes, there are 1207 full time managers – 73.77 buildings per manager.
You can also see those schemes required 1,1713,046 call out jobs from maintenance contractors over the year. That averages out to 19.23 jobs per year per building. If you think your committee and body corporate manager aren’t doing much, think about all the time and effort that goes into arranging those works.
If there is one major takeaway from the report, it’s that strata is big business and is growing all the time.
It will take non-stop effort from owners, committees and body corporate managers to keep everything in order, and the government will need to assist by introducing proactive legislation to help this take place. One way or another, there is a lot to do.
You can download a copy of the report here: 2022 Australasian Strata Insights report.
If you have any questions, ask your manager for assistance:
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Kelly Borell: Kelly.firstname.lastname@example.org P: 0435 766 852
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