Selling a Strata Property – What You Must Disclose

When it comes time to sell your strata titled property, it’s important to understand that your obligations and the processes are slightly different to selling a freestanding home. 

That doesn’t mean that you need to seek permission from the body corporate to sell or list your home for sale, but there are a number of legal and disclosure requirements that you must navigate.

In this article, we’ll explain the steps that you need to take and what you need to disclose when selling a strata titled property in Australia.

The need to disclose in strata buildings

Selling a strata building is different to selling a free-standing home. Because strata ownership means sharing walls, common areas, and obligations with other strata owners, owners are required to provide a detailed breakdown of what those responsibilities mean for prospective buyers.

Failing to meet obligations can lead to fines, delays in settlement, or even provide grounds for the would-be buyer to walk away from the sale. Disclosing protects the best interests of buyers and ensures that they are provided with a full and unimpeded view of their purchase.

Strata Certificate, Disclosure, or Statement

Depending on your state, you will have to supply certain particulars, often called a strata certificate, disclosure statement or form. The terminology will vary according to your state or territory; however, the documents all serve a very similar purpose and are important to disclose to potential buyers. 

According to the location of the property, this information will be known as one of the following:

South Australia: Strata Corporation – Form 1 (Section 7 Strata Information)

New South Wales: Strata Scheme – Section 184 Certificate (Strata Certificate)

Victoria: Owners Corporation – Owners Corporation Certificate (part of Section 32)

Queensland: Body Corporate – Section 206 Disclosure Statement

Western Australia: Strata Company – Form 28 (Pre-contractual Disclosure Statement)

ACT: Owners Corporation – Section 119 Certificate (Unit Title Certificate)

Tasmania: Body Corporate – Section 83 Certificate

Northern Territory: Unit Title – Section 54 Certificate

As an example, in South Australia the Form 1 will give prospective buyers a run-down of the following:

• The name and address of the strata or community corporation
• Contributions (levies) payable including any arrears
• Assets and liabilities of the strata or community corporation
• The lot / unit entitlement
• Minutes of general meetings and management committee meetings for the past 2 years
• Statement of accounts of the strata or community corporation
• Current policies of insurance of the strata or community corporation
• By-laws or articles of the strata or community corporation

Prospective buyers will commonly ask questions about information that is supplied in these documents as a way to understand any upcoming financial obligations, as well as use any outstanding or upcoming payments as a bargaining tool during the sale. 

Final thoughts

Selling a strata property in any state or territory of Australia requires careful preparation, accurate disclosure, and transparency. Failure to provide accurate and up-to-date information can lead to delays, contract disputes, or even the buyer exercising their right to rescind the contract. It’s important to understand your obligations early on to help facilitate a smooth sale and handover and avoid any disputes or unnecessary delays.