The Minns Labor Government will impose greater disclosure obligations and stamp out bad behaviour in the strata sector, with new laws set to be introduced to Parliament.
Strata laws put owners corporations in charge of making key decisions on the buildings and common property of townhouses and apartments. Owners Corporations usually appoint a strata managing agent to provide advice on meeting legal obligations and managing the delivery of services to the strata scheme.
Recently the behaviour of a small number of managing agents has put a dent in public confidence around apartment living.
NSW Fair Trading had more than 965 complaints about strata agents in the five years to 2023 with more than half of those complaints about rules of conduct or budgets, levies or finances.
We have a housing crisis in NSW and solving it means we need to build more high quality, higher density housing. More than 1.2 million people already live in strata communities in NSW and that number is set to grow under the Government’s comprehensive plan to build a better NSW.
New laws will help build confidence in the sector so apartment owners and residents can feel safe they aren’t being ripped off by unscrupulous agents.
Key changes proposed include:
- increasing the maximum penalties and penalty infringement notice amounts for existing agent obligations to disclose information about commissions.
- strengthening the conflict-of-interest disclosure requirements.
- banning agents from receiving a commission on insurance products when they don’t play a role in finding the best deal for residents.
- strengthening NSW Fair Trading’s enforcement and compliance powers.
Higher penalties, greater transparency and new enforcement powers follow an $8.4 million investment in more resources for the Strata and Property Services Commissioner in this year’s budget.
The Government will consult with key stakeholders such as the Owners Corporation Network and Strata Community Association on the draft laws in the coming weeks. The Parliament will consider the new laws later this year.
Minister for Better Regulation and Fair Trading Anoulack Chanthivong said:
“These reforms are critical to supporting confidence in investing and living in strata schemes.
“We want to change the perception that strata managing agents easily, and readily, take advantage of owners by significantly increasing the consequences for those who do the wrong thing.
“The new laws are designed to take immediate action to help restore confidence in living and investing in strata schemes, ensuring more people consider apartment living as a housing option.”
