If you’re considering buying a property, it’s important to understand the different types of ownership. Two common types are strata and non-strata homes. In this article, I’ll explore the differences between the two and what you need to know if you’re considering buying a strata-titled property.

Strata homes

A strata home is a property whereby the owner holds title to a portion of a larger property, typically a multi-unit building or a townhouse complex, and shares ownership of common areas and facilities with the other owners. As a strata owner, you’ll also pay monthly fees for the maintenance and upkeep of these shared spaces.

The strata corporation is the governing body of a shared building, living space, or community. The strata council is responsible for the strata corporation and how the strata is managed. They oversee the building, its management, and all associated aspects such as maintenance and upkeep of amenities. The council is made up of owners who are elected by their fellow owners.

Strata fees are monthly payments made to the strata corporation to cover the common expenses of the development or building, including building insurance, management fees, landscaping, waste collection, utilities and administrative costs, as well as irregular expenses such as lobby upgrades, a new roof, and sidewalk fixes. The specific amount each owner pays is determined by dividing the strata corporation’s total expenses by the unit entitlement based on the livable size of the lot.

Questions to ask when purchasing a strata home

For new communities, developers create an estimated overall budget to know what homeowners’ anticipated monthly fees will be. If you’re looking for a second opinion on the overall budget, check with an experienced realtor, lawyer, accountant, or property manager.

When you’re purchasing a re-sale home, you should confirm if your fees include utilities such as hot water, heat and gas. Also, how much money is being contributed to the reserve fund each year and is it enough to cover unanticipated expenses? When is the building warranty expiring? Have any major repairs such as a new roof been recently made or are planned? Check the minutes of the strata council meetings to ensure you have a clear understanding of what’s been completed, where money is being allocated and spent and whether the council is proactive or tends to do the bare minimum, which could lead to greater issues.

Non-strata homes

In contrast, a non-strata home refers to a property where the owner holds full title to the land and any structures on it, without any shared ownership or maintenance obligations. Essentially, owning a non-strata property means having sole ownership and control over the entire property.

Non-strata homes typically don’t have monthly fees, and the owner is responsible for all maintenance and upkeep of the property. While this type of ownership offers more control, it also means taking on more responsibility and costs.

Final thoughts

Whether you’re considering a strata or non-strata home, it’s essential to do your research and ask the right questions before making a purchase. With a strata-titled property, make sure to review the minutes of strata council meetings to understand how the strata is managed and where your fees are going. For non-strata homes, it’s important to budget for all maintenance and upkeep costs.

By understanding the differences between strata and non-strata homes, you’ll be better equipped to make an informed decision when buying a property.