Difference between Strata and Community Title

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If you’re looking to purchase property in Australia, you may have come across the terms “strata title” and “community title.” They both describe the type of property that you will be acquiring, but community titles are generally attached to much larger lots.

While they are quite similar concepts, there are a few key differences between the two terms that you should understand. In this post, we’ll cover the main differentiators between strata and community titles.

 

What is strata title?

A strata scheme is one which dictates how ownership is divided among owners in multi-unit complexes, such as apartment buildings, retail centres and other similar properties. With strata, each lot owner holds a title for their individual unit and shares responsibility for building facilities, including car parks and elevators.

In both strata and community title, lot owners come together to form a committee, called an owner’s corporation or body corporate. This group makes decisions regarding important community issues, such as maintenance and insurance. With strata, the committee can choose to hire a strata manager who will take care of all logistics related to the financial and administrative aspects of the scheme.

 

What is community title?

Similarly, a community scheme also defines how property is split, but it generally refers to a larger area, such as a neighbourhood or estate. In these cases, shared spaces such as roadways and community playgrounds. Community titles cover more prominent geographic locations so that multiple strata titles may be included in a single community title.

In New South Wales, when you enter a land lease community, you own your home but rent the land from the community operator. To learn more about these communities, check out this guide from the Department of Fair Trading.

 

How are they similar?

Both types of title have owners’ corporations who meet regularly to discuss pertinent matters within their community. Individual members are responsible for paying levies to the owner’s corporation, who will then oversee the smooth operation of the overall property.

The owner’s corporations will also determine a set of rules that each owner must abide by to remain part of the strata or community scheme. Some of these rules include noise levels and external maintenance.

 

How do they differ?

Strata refers to the distribution of units within a complex, whereas community title regulates plots of land, which can incorporate multiple buildings, retail shops and industrial sites. Also, community title owners share the use of infrastructure (such as streets) with one another.

Additionally, strata title owners are required to take out an insurance policy that covers their entire complex, the cost of which is split among lot owners. On the other hand, community title holders are responsible for their own insurance, while their owner’s corporation will manage insurance for shared facilities.

While both strata and community title were created for similar purposes, their key differences are essential to understand. Regardless of which scheme you purchase, both are intended to protect the collective interests of their residents and solve any issues that may arise.

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