Key information
- New strata laws include expanded disclosure requirements for strata managers (starting 3 February 2025).
- The expanded disclosure requirements are supported by stronger NSW Fair Trading enforcement and regulatory powers (starting on 8 November 2024).
- Further reforms are taking shape based on recommendations from the 2021 statutory review of NSW strata laws – the first phase of these reforms was delivered in 2023.
Why strata laws are changing
Changes to strata laws are being delivered to meet the needs of people who own or live in strata property in NSW.
Some changes were delivered in 2023, based on the recommendations in the 2021 Report on the Statutory Review of the Strata Schemes Development Act 2015 and Strata Schemes Management Act 2015.
Changes to disclosure requirements for strata managers mean strata managers will need to disclose more information, more often to strata property owners – starting from 3 February 2025.
More law changes will continue to be developed and delivered in line with the recommendations of the statutory review of strata laws and ongoing engagement with the strata sector, including those living in strata communities.
Increased disclosure obligations for strata managers
Reforms to strata laws will increase strata managers’ disclosure obligations to owners corporations.
Strata managers will need to disclose more information, more frequently to the owners corporation. This includes details about their connections with suppliers and developers, and commissions and training services they may receive.
Why are the changes needed?
The new disclosure requirements are needed to improve oversight of strata managers and whether they are acting in the owners corporation's interests.
Together, the expanded disclosure requirements will:
- make insurance arrangements more transparent, and
- equip owners corporations with clear and timely information to inform decision-making and enable scrutiny of their strata manager’s actions and interests.
When do the changes start?
The timeframes for the changes are:
- from 8 November, NSW Fair Trading has increased enforcement and regulatory powers in relation to existing disclosure requirements
- from 3 February 2025, the increased disclosure requirements for strata managers will start.
Who do the changes impact?
Strata property owners and strata managers should be aware of how the changes impact them.
Strata property owners will receive extra, more timely information from their strata managers. This will allow them to make better, more informed decisions about how to run their scheme.
For example, owners will be better informed in making their initial decision of whether to appoint the strata manager, based on the information the strata manager will have to disclose to them.
Owners will also benefit from more transparent insurance arrangements.
Strata committee members are strongly encouraged to understand strata managers’ increased disclosure requirements to owners corporations to ensure that their strata manager complies.
To ensure they are ready to comply, strata managers will need to understand the new disclosure requirements before they start from 3 February 2025.
The changes enhance your obligation to provide owners corporations with more transparent and timely information. This will support your clients to have confidence when the management agreement is being signed, and throughout the term of appointment.
Strata managers who breach the new disclosure obligations could face significant court-imposed penalties up to $110,000.
Summary of the new disclosure requirements
Strata managers will need to disclose more information before they are appointed to a strata scheme as well as during their appointment.
There are also changes to make insurance arrangements more transparent.
Disclosures before a strata manager’s appointment
Before a strata manager is appointed, they will need to disclose:
- more information to the owners corporation about connections with suppliers they routinely use, including details about the nature of the relationship
- whether they have given advice about strata plans or a community land scheme plan to the building developer in the last 2 years.
Disclosures during the strata manager’s appointment
Strata managers will have the following new requirements:
Strata managers will need to provide the owners corporation with a written explanation when seeking approval for a commission or training service. The written explanation will need to include why approval is in the owners corporation’s interest and prescribed details including the commission amount. The owners will review and decide on the approval request at a meeting of the owners corporation.
This requirement means that strata managers can't receive any commission or training service without it going through this approval process – unless it has already been included in the management agreement. This is the ‘contract’ the owners corporation negotiates with the strata manager when the strata manager is being appointed.
The strata manager will need to write to the owners as soon as practicable once they become aware of any connections or interests they have in relation to their strata scheme.
Examples include if the strata manager becomes connected to a service provider the strata scheme is using, or they buy property in the strata scheme.
The strata manager will also need to give the owners corporation written notice about certain matters before they enter into a contract on behalf of the owners corporation where they will, for example, use a related supplier.
The strata manager will need to provide more information at the AGM, including any connections they have with suppliers or the building’s developer and connections from the previous 12 months.
This is on top of the strata manager’s existing obligation to disclose the commissions and training services they have received over the past 12 months, and expect to receive in the next 12 months.
Strata managers will need to provide clearly itemised quotations for insurance policies. This includes setting out commission and broker fee amounts – and who these are ultimately paid to. The base premium amount of the insurance and GST will also need to be clearly set out.
Strata managers will be banned from getting a commission on insurance if the owners corporation obtained the quote and arranged for its payment independently, without their help.
More information and support
NSW Fair Trading will be emailing strata managers and office bearers registered in the Strata Hub about the new disclosure obligations.
More information for strata managers will be available on the disclosure requirements page on the NSW Fair Trading website.
We will update this page with information about other changes to strata laws during 2025.
Related links
Contact NSW Fair Trading
Online: Complaints and enquiries
Phone: 13 32 20 (Monday to Friday, 8:30am-5pm)
In-person: find a service centre
Follow NSW Fair Trading
Follow us on social media.
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