Recent reports state that there is an oversupply of apartment developments in some of our capital cities and mid-ring suburbs, and this might be the case in some locations. However, demographic studies reflect that this could be a short-term problem. The long-term trends show that as a result of an ageing population and changing lifestyles, smaller households will no longer be looking for larger homes on big blocks of land.
According to recent ABS research, the number of Australians living alone is projected to rise by up to 65 per cent over the next 25 years to between 3.3 and 3.4 million households by 2036, up from 2.1 million in 2011. In the same period, the number of couple-only families is predicted to jump to 3.8 million families in 2036, up 64 per cent from 2011. Many of these households will be seeking to live in a unit/townhouse or apartment which means they will experience ‘strata living’.
What exactly is strata living?
The word ‘strata’ relates to the title you hold over the apartment or unit that you purchase in a multi-dwelling property. Legislation is different in each of Australia’s states and territories around strata-titled property, but basically a strata title allows ownership of a ‘lot’ of property – the apartment, townhouse or unit – and shared ownership of the rest of the property (common property) through the owners corporation (previously known as body corporate). A responsibility of ownership means that you become part of the owners corporation and are involved in decisions around the management of the property.
Don’t be put off by the jargon and legislation around strata living. Instead, look beyond to what it offers.
Strata living allows you a lifestyle you would most probably not be able to afford if you were intent on living on a full-block in a four bedroom, two bathroom home. Developers have responded to the requirements and preferences of empty-nesters and smaller households and built strata property in key locations:
Many who have swapped their family home for strata-living would never go back, having experienced the lifestyles on offer.
With strata living, the common property, e.g. gardens, pool (if there is one), driveways, external structure of the building is not your individual responsibility. The owners corporation takes care of these areas, and maintenance and upkeep are paid for out of your strata levies. So if the gutters need painting, the gardens need pruning or the foyer needs a facelift, it will be addressed at the owners corporation meeting and action will be taken.
Lock up and leave
Another attraction of strata living is that you can lock up the property and leave; head off for the weekend, travel for work or if you are retired enjoy those extended holidays you deserve. Strata homes are usually secure and unable to be easily accessed unless you are a resident and your gardens won’t become overgrown while you are away as this will have already been taken care of.
Renters love strata
Of course, all the attractions of strata living make strata property a great investment. The price of entry for an investor is often lower than purchasing a family home. You can invest in a newer property and claim higher depreciation allowances. You might even buy off the plan and avoid onerous stamp duty. As with any other property investment you need to choose your location carefully and watch out for over-developed areas with higher than average vacancy rates.