Your Simple Guide to Body Corporate Fees in Australia

Are you an owner of a strata property in Australia? If you are, then you will be aware that there are fees associated with owning in a strata-titled building. These fees will be collected by the body corporate who use these fees to cover the cost of maintaining and repairing the common areas, as well as paying for general running costs such as building insurance.

But what exactly are body corporate fees (also known as strata fees or strata levies)? And how are body corporate fees calculated in Australia?

In this article, we’ll take a closer look at body corporate fees in Australia and answer some of the most common questions about these fees, including how they’re calculated and what they’re used for.

So, if you’re an owner of a strata property wanting to learn more about body corporate fees in Australia, read on!

What are body corporate fees? 

Body corporate fees are calculated based on the lot entitlement (also known as unit entitlements) of each lot or unit. These lot or unit entitlements are established on creation of the strata and are based on the approximate value of each unit. There are a number of factors that can influence body corporate fees including:

• The size of the building
• The number of occupants
• The age of the building
• The general condition of the building
• The efficacy of maintenance over the years

Generally speaking, new buildings which require less maintenance will charge lower body corporate fees than an old building that requires more maintenance. Body corporate fees are designed to spread out the cost of maintenance to all occupants of a building and ensure that everyone is chipping in to keep an apartment complex in comfortable working order for its inhabitants.

What do body corporate fees cover?

Body corporate fees are generally used to cover the maintenance of the building and repairs to common areas. In addition, body corporate fees will go towards general running costs and building insurance.

Some of the specific things that body corporate fees may cover include:

• Cleaning and gardening of common areas
• Repairs and maintenance to common areas
• Paying building caretakers
• Insurance premiums
• Strata management fees
• Electricity and water bills for common areas

Each building is different, so it’s important to understand what is (and is not) covered by body corporate fees.

How can I save money on body corporate fees?

There are a few ways that you can make sure that you are getting the best value from your body corporate fees and (in some cases) even reduce your premium.

Some of the ways that you can save money on body corporate fees include:

Address issues as needed: Issues that are left unattended for an extended period of time can worsen and result in more costly repairs down the line which is ultimately passed onto owners through the body corporate fees.

Use energy-efficient lighting: Using energy-efficient lighting in your shared common areas is an effective way to cut down on your electricity bill which can come back to you in the form of lower body corporate fees.

Build up a sinking fund: A sinking fund is a fund set aside for non-recurrent expenditure such as exterior painting or roof replacement.  If these funds are built up gradually over time, it will prevent the bill shock of a special levy raised to fund these.  It is better to save up for them gradually over the years than have to raise the money all at once when the need arises.

Looking at the different aspects that make up your body corporate fees and coming together with other occupants/owners can help to brainstorm different ways to reduce your outgoing costs and effectively lower body corporate fees.

Who pays the body corporate fees? Owner or occupier?

The owner of the property is responsible for paying the body corporate fees. However, in some circumstances, the occupier of the property may be liable to re-imburse the owner some or all of the fees if they have entered into an agreement with the owner that stipulates that they will be responsible for such payments.

Generally, landlords will incorporate body corporate fees into the rent that is paid by the occupier throughout the course of their tenancy.

Final Thoughts

As you can see, body corporate fees in Australia can vary widely depending on the type of property and the location. However, as a general rule, you can expect to pay a few thousand dollars per year in body corporate fees – but this number will depend on your building and your unique circumstances.

While body corporate fees may seem like a hassle, they are actually used to cover a range of important expenses, such as building insurance, maintenance, and repairs. In most cases, these fees represent good value for money and help to keep your property in good condition.

If you have any questions about your body corporate fees, be sure to speak to your strata manager or property manager. They will be able to provide you with more information and advice about how to budget for these costs.