NSW government proposes strata law overhaul
NSW government proposes strata law overhaul | Insurance Business Australia
Insurance News
NSW government proposes strata law overhaul
Consumer advocacy group welcomes proposed amendments
Insurance News
By
Roxanne Libatique
The Minns Labor Government is set to introduce new strata laws aimed at enhancing disclosure requirements and curbing misconduct within the strata sector. These legislative proposals will soon be presented to Parliament.
Under current strata laws, owners corporations are responsible for making key decisions about buildings and common property in townhouses and apartments. Typically, these corporations appoint strata managing agents to provide advice on legal compliance and service management for the strata scheme.
Over the past five years, NSW Fair Trading received more than 965 complaints about strata agents, with more than half pertaining to conduct rules, budgets, levies, or finances.
In addressing the housing crisis in New South Wales (NSW), the construction of more high-quality, higher-density housing is essential, Chanthivong said.
Currently, more than 1.2 million people live in strata communities in NSW, a number expected to increase under the government’s plan to improve housing.
New South Wales new strata laws
The proposed laws aim to rebuild trust in the sector, ensuring apartment owners and residents feel protected from unethical agents. Key changes include:
raising the maximum penalties and penalty infringement notice amounts for agent obligations related to commission disclosure;
strengthening conflict-of-interest disclosure requirements;
prohibiting agents from receiving commissions on insurance products unless they are actively involved in securing the best deals for residents; and
enhancing NSW Fair Trading’s enforcement and compliance powers.
These measures follow an $8.4 million investment in additional resources for the Strata and Property Services Commissioner in this year’s budget. The government will consult with stakeholders such as the Owners Corporation Network and Strata Community Association on the draft laws in the coming weeks, with Parliament set to review the proposals later this year.
Chanthivong said the proposed laws are essential to boosting confidence in investing and living in strata schemes.
“We want to change the perception that strata managing agents easily, and readily, take advantage of owners by significantly increasing the consequences for those who do the wrong thing,” he said. “The new laws are designed to take immediate action to help restore confidence in living and investing in strata schemes, ensuring more people consider apartment living as a housing option.”
Australian Consumers Insurance Lobby welcomes proposed strata laws in New South Wales
The Australian Consumers Insurance Lobby (ACIL) has expressed support for the proposed changes, which aim to enhance transparency and accountability in the strata insurance sector.
“We support the proposed changes by the NSW government as they are a step towards enhancing transparency and stamping out unethical behaviour in the strata insurance sector,” said ACIL chair Tyrone Shandiman. “ACIL will be reviewing legislative proposals to ensure they meet the standards that consumers need. We certainly want to avoid the situation that occurred in 2015, where industry bodies negotiated legislation that was so watered down it had the opposite effect of what was intended. We view this moment as a pivotal opportunity to ensure that the right outcomes for consumers are in place, overcoming the significant issues that have publicly tarnished the industry. The devil will be in the detail.”
ACIL also emphasised that legislation alone cannot achieve the necessary professionalism in the industry. He stressed the importance of organisations like the Strata Community Association working diligently to uphold ethics, transparency, professionalism, and accountability, prioritising consumer interests.
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