Are strata dwellers being sold out?

Are we long-term strata dwellers being treated – yet again – as second-class citizens?

Last week, submissions into the review of strata laws in NSW closed, with the hottest topic being the potential for forced sales of strata units.

Under proposed legislation, 75 percent of owners will be able to force the other 25 percent to sell their homes to developers. Currently, the law requires 100 percent of owners to vote in favour.

[You can read the section of the exposure draft relating to strata renewal HERE]

At the same time there were reports of neighbours in free-standing houses who had clubbed together to sell their homes to developers as one block, garnering much higher prices than they could have if they had sold individually.

Of course, all of them had to agree.  But if they came under the proposed strata laws, three neighbours could tell a fourth to start house-hunting. Imagine the outrage.

So, does that make strata dwellers a lower priority in government eyes? It certainly betrays a sense of “whatever” that goes all the way back to the last Labor government and beyond.

It’s not the concept of a majority of owners being able to force their neighbours to sell their homes that jibes with a sense of fair play.  It’s the uniquely low voting threshold that will be required in NSW that just feels so wrong to so many.

There are very old buildings in this state that are well past their use-by dates but which have to be maintained at increasing expense by everyone, including those who do want to sell out.

The threat of investors buying up decent buildings in prime locations then railroading the resident owners into a development deal, is every bit as real as fears of opportunist hold-outs hoping to raise a premium price.

Other places have the same issues, but very different solutions. In WA, they are looking at a sliding scale starting at 95 percent, with the older the building, the lower the vote required.  Even then, the lowest, for buildings more than 30 years old, is 80 percent.

In Singapore, the “sell” vote is set at 80 percent, but there is a tribunal and residents who don’t want to sell can be awarded a premium that speculative investors just won’t get.

So why is the threshold in NSW set so low?  Maybe it’s a question of mind over matter.  The pollies don’t mind and we don’t matter. There’s more on this on HERE.