FAQ

Frequently asked questions

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    Q?

    What is a maintenance fund?

    A.

    A maintenance fund or a sinking fund is the regular investment of funds to meet anticipated future capital expenditure of the property.

    Q?

    What is an Owners Corporation?

    A.

    An owners corporation (formerly body corporate) is a body of owners that manage the common property of a residential, commercial, retail, industrial or mixed-use property development. The common property is defined as any property not on title to any one particular owner include stairs, paths, elevators, lobbies, driveways, pools, common garden areas and other facilities set up for use by owners and occupiers.

    Q?

    What regulates an owners corporation in Victoria?

    A.

    The Subdivision Act 1988, Owners Corporation Act 2006, Owners Corporation Regulations 2018, Model Rules (Schedule 2) and the Rules of the Owners Corporation regulate owners corporations in Victoria. The Owners Corporations Act 2006 and the Owners Corporations Regulations 2007 are available through Consumer Affairs Victoria link. You can also read a complete PDF of the Act and the Regulations here.

    Q?

    What is the role of the Owners Corporation Manager?

    A.

    The Owners Corporation Manager carries out some or all of the functions, duties or powers of the owners corporation in administering and maintaining An Owners Corporation. These tasks include secretariat and administration, arranging insurance, organising maintenance works, maintaining financial records and bank accounts, advising on rules and legal matters.

    Q?

    What is the difference between a strata title, body corporate and an owners corporation in Victoria?

    A.

    What was previously known as a ‘Body Corporate’ became an ‘Owners Corporation’ on 31 December 2007, when the Owners Corporations Act 2006 came into force. ‘Strata title’ is a more generic term for a plan of subdivision containing common property that an Owners Corporation is responsible for managing.

    Q?

    Who is responsible for insurance on the property?

    A.

    An Owners Corporation must have public liability insurance in connection with the common property and reinstatement and replacement insurance for all buildings on the common property. It is recommended that a valuation be obtained from a qualified valuer on a periodic basis to ensure that the full value of the buildings is insured thereby reducing the risk of members in the event of a substantial loss.

    It is important to note that the Owners Corporation insurance does not cover the contents of owners’ units and members should ensure that they have appropriate contents cover in place, whether a resident or landlord of a tenanted property. Members should ensure that the policy in place for their property includes public liability cover.