Strata and Body Corporate: How Shared Property Ownership Works

What You Actually Own in a Strata Property

Picture a six-storey apartment block. One buyer purchases unit 3B. They own that unit — the internal space within the walls — but they don't own the roof, the stairwell, the lobby, or the garden outside. Those spaces are shared equally among all the owners in the building.

This shared ownership structure is called a strata title. Each individual apartment or townhouse is called a lot, and everything outside the lots — the lifts, pool, parking structure, hallways — is called common property. Every lot owner has a share in that common property, proportional to their lot size or entitlement as defined in the strata plan.

If you're still weighing up whether buying is right for you at all, see our guide to renting vs. buying for a broader view of the trade-offs involved.

How the Body Corporate Works

The body corporate is essentially the collective of all lot owners. By buying into a strata scheme, you automatically become a member. The body corporate is responsible for:

• Maintaining and repairing common property
• Taking out building insurance for shared structures
• Setting and enforcing by-laws — the rules that govern what residents can and can't do
• Managing two key financial funds: an administrative fund for everyday running costs, and a sinking fund (or capital works fund) for large future repairs

Most bodies corporate elect a smaller committee to handle routine decisions, and many hire a professional strata manager to handle administration. Big decisions — like approving major renovations or changing by-laws — are put to a vote at general meetings, where owners have a say proportional to their lot entitlement.

“The body corporate is not an outside authority imposing rules on you — you are the body corporate. Every owner has both rights and responsibilities in how the building is managed.”

— City Futures Research Centre, Strata housing research unit, University of New South Wales

Understanding Strata Levies

This is the part that catches many first-time buyers off guard: owning a strata property means paying ongoing levies (fees) to the body corporate, on top of your mortgage. Levies fund everything from weekly cleaning of common areas to eventually replacing the building's aging plumbing.

Levies are usually paid quarterly. The amount varies widely — a small block of four townhouses with no pool might charge a few hundred dollars per quarter, while a high-rise with a concierge, gym, and pool could charge several thousand. Before you make an offer, find out the current levy amount and ask whether any special levies are planned. A special levy is an extra one-off charge raised when the sinking fund doesn't cover an unexpected major expense.

Since levies are a recurring cost, treat them the same way you'd treat council rates or building insurance — essential items that belong in your budget from day one. Our article on the hidden costs of buying a home covers levies alongside the other expenses first-timers often overlook.

What to Check Before You Buy

A strata property's condition isn't just about the apartment itself — it's about the financial health of the whole building. Here's what to look at:

• Strata report: A document (usually ordered through a specialist search company) that includes financial statements, meeting minutes, by-laws, and any known disputes or defects.
• Sinking fund balance: A well-funded sinking fund means the building is prepared for big expenses. A near-empty one could mean a special levy is coming.
• Meeting minutes: These reveal ongoing issues — recurring leaks, disputes between owners, maintenance that keeps getting deferred.
• By-laws: Check rules around pets, short-term rentals, renovations, and parking before you commit.

It's also worth understanding how strata fits into the broader picture of property ownership structures. Our explainer on freehold vs. leasehold ownership explains another key distinction you'll encounter when researching properties.

This article provides general information about strata and body corporate concepts and is not legal or financial advice. Rules, terminology, and obligations vary by state and territory. Consult a licensed property lawyer or conveyancer for guidance specific to your situation.