One might think that strata and property managers are basically the same. It is just a piece of real estate for renting, how much different could it be managing the two? As it turns out, quite much so. Depending on the market you find yourself in, property and strata managers are both useful in the real estate industry but have different roles. For anyone looking to start investing in a strata building or some other form of property, it is important to go over these key distinctions. Only then can you know what are your responsibilities, expectations, and duties towards your investment.
First of all, what are strata and property managers? A strata manager is a company that manages an apartment block in the name of all the individual owners located there. The actual owner’s interest is shared with a reputable strata manager in Sydney and it encompasses everything from legal compliances, building maintenance, and financial administration. Chances are that an apartment block has a designated strata manager. If not, chances are that the residents are living in a self-managed block. That means the owners are performing all of the strata manager’s functions themselves. On the other hand, a property manager is a person or company that looks over the management and maintenance of a single piece of property. The main difference is that they are working in the name of one apartment owner instead of all the owners in an apartment block.
Strata manager’s responsibilities
What are the duties of both strata and property owners? Let’s start with the strata part. The responsibilities of a strata manager can be summarized into three main categories: administration, finance, and community. Administration involves meetings, correspondence between owners and buyers and legal compliances like fire and elevator certifications and insurances. Managers need to make sure the correct valuations are done in order for the building to be insured for a potential full replacement cost. This is put in place so that, if something were to happen to the building, the owners would not have to grab their own pockets in order to make up the deficit of an inadequate health insurance plan. As for maintenance, pool cleaning, communal wall maintenance, elevators, and any emergency repairs are all responsibilities of the manager. Strata managers also facilitate payments, balance the books and oversee regular financial contributions made by owners that serve the maintenance of the communal property. These are more commonly known as levies and there are three types: administrative fund, sinking find and special levies. Administrative levies cover everyday, mundane maintenance issues. Sinking levies are there to cover large repairs and renovation. Finally, special levies cover unexpected and unorthodox situations like roof renovations and pest control. Just as you would think that there cannot be any more responsibilities for strata managers, you realize that they also need to act as psychologists, peacemakers and problem-solvers in general. If the owners cannot see eye to eye for whatever reason, managers are called to resolve the situation. More importantly, if a tenant has violated a strata scheme bylaw, it needs to be resolved as quickly as possible to avoid further complications.
Property manager’s responsibilities
Essentially, the property manager acts as a middleman between the landlord and the occupant. Their responsibilities are finding an adequate tenant, collecting rent and managing maintenance for the apartment interior. As for the exterior, as in beyond the four walls of the unit itself, that falls under the jurisdiction of the strata manager. For anyone that has ever rented an apartment, it comes as a no surprise to work with a media in the form of a property manager instead of the actual owner. They are the ones to call in cases of emergency, which is a lot like dealing with strata managers. Another responsibility of a property manager is to inspect the rental property at regular intervals to ensure adequate maintenance. Property managers are not necessary or mandated by law. Never the less, most landlords decide to acquire the services of property managers as they can manage all the necessary situations in a professional manner. If nothing else, they will provide you with a peace of mind and save you precious time an hassle of dealing with the actual tenants.
Why are these differences between the strata and property managers enforced? The answer is if these two types were to perform each other’s duties, it would pose a conflict of interest. IF a dispute were to arise between two properties, this necessitates the intervention of a strata manager. If that manager were also to be a property manager for one party of the dispute, this is a pretty clear conundrum and conflict of interest. Finally, strata managers have certain legal obligations when it comes to their functions in a building. Some of this might be in direct opposition with the wishes of a landlord. There are obvious incompatibilities between these two terms, even if they might seem very similar in some instances. Knowing the difference and informing oneself about the responsibilities of both is the first step to take for anyone willing to start investing in property.