Question: We own and maintain a block of 4 units. Can we self-manage? We feel our strata manager does little for their fee.
My partner and I own a small block of 4 strata units which we keep like new. We have attended to all repairs and maintenance at the property for over 10 years. Would we be better off taking over the strata management? We feel our strata manager does nothing apart from bookkeeping and costs us a fortune in fees.
Answer: I would speculate that if you did take on strata management responsibilities, you would quickly discover there was considerably more to it than you first thought.
What a strata manager does is quite different to what you have seemingly and successfully been doing with maintenance. It is not just ‘bookkeeping’ in other words. The strata manager for example will usually maintain records, an essential function if at any stage you decide to sell some or all of your lots. Your strata manager may also be a member of the professional body, which ensures they keep their professional standards and general strata knowledge up to date. Again, this can only be of benefit to you.
While I obviously don’t know what your skill sets are, I would speculate that if you did take on strata management responsibilities, you would quickly discover there was considerably more to than you first thought. Bear in mind also that in some jurisdictions there are obligations to be registered if you are performing functions as a strata manager – which would be another cost and responsibility you may have to meet.
Perhaps your better approach is to have some discussions with your current managers to clarify any issues on which you are dissatisfied and what could potentially be done differently into the future.
This post appears in Strata News #589.
Chris Irons
Strata Solve
E: chris@stratasolve.com.au
P: 0419 805 898
Hi, the problem of continuity happens with strata managers too. I’ve been on committees in two buildings where the (excellent) individual managers resigned, to be replaced by the (large) strata companies we were using. In both cases, things deteriorated, in one case catastrophically (literally no bills paid for six months; long-time cleaners sacked). Management made nice noises, but didn’t fix anything or return any management fees.
In both cases we went to self-management, backed by good accountants and specialist strata lawyers as needed. We maintain all data and accounts on specialist strata software (as used by strata firms) which produces all reports etc.
So we still have costs., but we have much greater control. The committee workload is actually not that different.
My strong recommendation to anyone is to never fully delegate authority to your strata managers. Retain signoff on any non-regular expenditures, choice of contractors etc. And get monthly reports.
Good managers will be happy to oblige.
I live in a block of four town houses. Our body corporate fees are double all the others in the street. We are giving serious thought to self management.
I like that you pointed out that it is really important to have control and know what is happening and supposed to happen. I think that, even if you don’t have a self-managed body corporate, you need to retain some control and make sure that you know what’s happening. Having control is one of the only ways that you can make sure you get what you want.