More than four million Australians now live in strata schemes, a new report has found.

UNSW City Futures Research Centre and Strata Community Association (SCA) have published the 2024 edition of their Australian Strata Insights Report.

Published every two years since 2018, the report delivers a profile of the strata industry across Australia and New Zealand.

In respect of Australia specifically, data is drawn from the Australian Census, land title offices, the insurance sector and SCA’s own data.

In terms of Australia, according to the report:

• 2 million people or 15 percent of the population now live in strata. Of these, 2.5 million live in private apartments whilst other residents live in other dwelling types such as units and townhouses.
• In total, there are 366,234 strata schemes which cover 3,191,244 dwellings. This represents a significant level of growth compared with the first report in 2018. In that report, 316,227 schemes covered 2,587,397 properties.
• Almost half (48 percent) of all schemes which are currently in existence were registered before 2000 and are 25 years old or older.
• The aggregate insured value of all strata buildings is estimated at $1.4 trillion.
• All up, 6,452 people are directly employed in strata management. This includes 2,796 full-time strata managers and 3,656 other employees.

In New Zealand, the strata industry is smaller but growing. All up, 15,678 strata schemes cover 176,334 units and are serviced by 419 employees.

The data also provides an insight into who lives in apartments.

This data is drawn the most recent ABS Census in 2021. It captures residents who live in apartments only and does not include those who live in non-apartment strata premises.

According to the data, among apartment residents:

• More than half (54 percent) were born outside of Australia, with China and India being the largest of these groups.
• Almost half (47 percent) commonly speak languages other than English at home.
• Almost half (48 percent) are aged between 20 and 39 years old.
• 39 percent are lone people whilst a further 25 percent are couples with no children.

Industry growing in importance but facing challenges

The latest report comes as the role and importance of strata titled properties continues to grow across Australia in response to efforts to address housing supply and affordability.

This will occur as multi-residential construction is set to play a key role in ambitions to deliver 1.2 million new homes under the National Housing Accord.

Multi-residential buildings are also a key focus of New South Wales and Victorian Government efforts to unlock medium density housing across Sydney and Melbourne.

The survey also comes as the strata industry faces challenges in two areas.

First, there are ongoing difficulties with defects in new buildings.

In New South Wales, for example, a 2023 survey of strata managers who look after newly constructed apartment buildings of four storeys or greater found that defects were present in more than half (53 percent) of all recently constructed buildings.

Common defects relate to waterproofing, fire safety systems, building envelope, structure, building services (mechanical/electrical etc.) and non-compliant cladding.

In addition, there are concerns of unscrupulous behaviour in strata management companies.

A report on the ABC’s Four Corners program uncovered allegations of practices such as hidden kickbacks from builders and insurance companies, hidden ownership of companies with which they (strata managers) deal, and indifference to the needs of the property owners who employ strata managers.

A separate research report released in August last year found an ‘extraordinary array of ethical tensions within the industry’ (refer article in The Conversation).

In response, Strata Communities Australia unveiled a six-point plan to deliver improved confidence when dealing with its members.

In addition, the New South Wales chapter of SCA adopted a Professional Standards Scheme in 2021.

In practice, however, SCA’s powers in respect of unprofessional conduct are limited to refusing or cancelling SCA memberships.

Accordingly, others are pushing for broader changes in terms of regulation and contractual frameworks (see above article).

Four takeaway points

Commenting on the report, SCA President Joshua Baldwin raised four points.

First, the importance of strata management will continue to grow as the number of people who live in multi-residential construction (units/townhouses/apartments) continues to grow.

Next, ongoing effort will be needed to ensure the strata management industry maintains sufficient capacity meet the needs of strata residents.

This will require action in terms of education, training, qualifications, workforce development, business support and industry professionalism.

Third, ongoing effort will be needed to manage and reconcile competing objectives and priorities of renters, owner-occupiers, non-occupying owners, building committees and other stakeholders within strata schemes.

It will also be necessary to be clear about the roles and responsibilities of all strata participants.

Finally, there are ongoing challenges in respect of building quality and safety.

According to Baldwin, this will involve not only addressing quality issues in new builds but also undertaking repairs, maintenance, renovation and upgrades of the half of the strata building stock which is more than 25 years old (see above).

Should these challenges remain unaddressed, Baldwin says that the future of a significant volume of building stock within strata schemes may be uncertain.

Exciting times

Overall, Baldwin is optimistic about the future.

“As we continue to look at the strata industry as a whole and the strata community and the impact (which it has) into the economy, I think it is an exciting time,” he says.

Enjoying Sourceable articles? Subscribe for Free and receive daily updates of all articles which are published on our site

Want to grow your sales, reach more new clients and expand your client base across Australia’s design and construction sector?

Advertise on Sourceable and have your business seen by the thousands of architects, engineers, builders/construction contractors, subcontractors/trade contractors, property developers and building industry suppliers who read our stories across the civil, commercial and residential construction sector