Strata fees are owner contributions that fund the shared costs of running and maintaining a strata scheme — common property repairs, cleaning, gardening, building insurance, common-area utilities, strata management, administration and saving for future major works. In NSW they are paid into an administrative fund and a capital works fund.
Strata fees are the regular contributions owners pay to fund the shared costs of a strata scheme. They are also called strata levies, owners corporation fees, body corporate levies or owner contributions depending on the state and the scheme.
Strata fees pay for things that benefit, or are required for, the scheme as a whole. They are not a fee paid just to the strata manager — the management fee is only one line in a much wider budget.
In NSW, regular levies are paid into two main funds: the administrative fund for day-to-day costs and the capital works fund for major, longer-term expenditure. If those budgets are not enough for an unexpected cost, the owners corporation can approve a special levy.
In everyday conversation these terms describe the same basic idea: money collected from lot owners to meet the shared expenses of the scheme. The legal terminology changes by state, and so do the fund names and calculation rules.
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The administrative fund is the scheme's day-to-day operating fund, used for routine and recurring expenses needed to run the owners corporation and maintain common property. The annual budget estimates expected spending, and the owners corporation raises levies to fund that budget.
Typical items include cleaning and gardening, common-area utilities, routine repairs and servicing, insurance, strata management fees, meeting and record administration, and regular contractor costs.
Think of the administrative fund as the building's everyday operating account — the money needed to keep the scheme functioning this year.
The capital works fund is for major, longer-term expenditure rather than ordinary running costs. NSW schemes generally plan ahead through a 10-year capital works fund plan, taking into account upcoming major repairs, replacement and improvement needs.
Typical items include major repainting, roof repairs or replacement, lift modernisation, replacing common-property flooring, major waterproofing or structural works, and facade or balcony projects.
Saving gradually is intended to reduce the risk that owners are suddenly asked for a very large amount when an expensive building component needs work. Think of it as the building's long-term savings account.
A special levy is an extra contribution raised when the normal approved levies are not enough to meet a particular expense. In NSW, the owners corporation can vote at a general meeting to introduce a special levy when there is insufficient money to cover expenses such as major repairs. Like annual levies, the amount is generally worked out using each owner's unit entitlement.
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The administrative fund pays regular maintenance, insurance and other recurring costs such as body corporate management fees and electricity. The sinking fund is for major or one-off capital items such as building painting, structural repairs and replacement of major common-property assets, budgeted across a 10-year outlook. Queensland law keeps the two funds separate rather than treating them as one interchangeable pool.
Victorian owners corporations set annual fees and, where needed, special fees, with a maintenance fund required or adopted in certain circumstances. In Western Australia, contributions cover projected scheme costs and are paid into funds administered by the strata company, including an administrative fund and a reserve fund.
The scheme first determines how much money needs to be raised, then divides that amount among the lots using the legal allocation method for that jurisdiction. In NSW, levies are generally based on each lot's unit entitlement, so a lot with a higher unit entitlement usually pays a larger share.
No — this is a common misunderstanding. The management fee is one line in the owners corporation's budget. The total levy also funds insurance, maintenance, utilities, contractors, compliance, administration and long-term capital works. NSW Government guidance specifically notes that the manager's fee is part of the levy, but the total levies pay for the broader costs of running and maintaining the complex.
No. High levies can reflect high service levels, strong long-term funding, expensive facilities or a building actively paying for necessary maintenance. Very low levies can look attractive while hiding underfunded maintenance, inadequate reserves or future special levies.
The better question is not "are these fees high?" but "are these fees explained, justified and adequately funding the building's real needs?"
Start with the scheme's approved budget and most recent financial statements, then review:
Compare written fee proposals from strata managers covering your building — free for owners corporations, no obligation.