WA's new strata regime: close, but no cigar just yet

Corks have been popping to celebrate the passage of the Strata Titles Amendment Bill 2018 (WA) last week and the Community Titles Bill 2018 this week, and with good reason – it is a major milestone in WA's shift to more flexible and modern strata laws. But any celebrations based on the idea that the reforms are now in effect would be premature. That's because much of the practical, day-to-day operation of the regime will be governed by Regulations - which are yet to be drafted.

The main elements of the new strata regime at a glance

The overhaul of WA's strata regime has at its core two new forms of strata - Community Titles and Leasehold Strata - and a policy shift towards greater flexibility and clearer rights for owners, developers, investors, residents, and tenants.

Under the Community Titles scheme, a single parcel of freehold land can be subdivided to create multiple tiers of schemes in the one community scheme, each with its own community corporation. Each owner of a lot will have a share in the community property of all the other schemes.

Leasehold Strata will be like a freehold strata scheme, including its similar governance model, but for a fixed period.

Along with these two fundamental changes come improvements to stage subdivision, scheme management (strata managers are now enshrined in legislation, strata companies can enforce their duties, and greater powers for owners), by-law enforcement, simpler dispute resolution, and a new process (and safeguards for minority lot owners) for termination of a strata titles scheme which has 5 or more lots.

Sounds great, but…

Some of the key issues to be covered in the Regulations will include:

• scheme plan requirements, calculation of lot boundaries, and application fees;
• whether there are any additional notifiable variation events;
• whether there is any change to the minimum term of a leasehold scheme;
• when local government approval is required for a lease or licence of common property; and
• whether a proponent of a proposal to terminate a strata titles scheme must enter into any specific arrangements with lot owners of that scheme.

What's next for strata reform in WA

We expect the State Government to begin consultation on Regulations soon, so it's important to keep an eye out for the draft Regulations and make a submission where possible to help shape these missing, crucial parts of the new strata regime.