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A strata company in Sydney has been placed in administration leaving thousands of apartment owners facing uncertainty, according to a recent announcement.
The boutique company The Strata Agency was placed in administration on Wednesday, and this may be the start of things to come, according to chief executive officer of Vesture Limited, Patrik Bruhlmann.
“We have been saying for some time now that Australia’s $500 billion strata title management industry is set for a major shakeup over the next decade,” Mr Bruhlmann said.
Currently, he said, there is a push towards greater regulation with many hundreds of companies operating in the strata management space.
“In the QLD, NSW and VIC alone, there are more than 500 companies operating, including real estate agents, law firms and accountants competing for a share of the market,’’ he said.
“There are now hundreds and hundreds of small, private operators who are managing less than 1,000 lots”.
The collapse of a strata management company can cause a “lot of worry” for apartment owners.
“In our experiences, the owners corporations are always concerned about the security of their funds, about the delays in work being done or invoices being paid and the ongoing day-to-day functions of the owners corporation,” he said, explaining the importance of choosing the right management.
“The good news for owners in this instance is that New South Wales legislation requires funds for owners corporations to be held in trust, so it should be protected.”
An apartment is a personal residence within a house or building occupied by several tenants.