Strata vs Body Corporate

The question is usually asked as though these were two systems you might choose between. They are not. They describe different things, and the confusion comes from the fact that different states use different words for the same job.

Strata describes a form of title. It is the arrangement where you own a defined lot, such as the inside of an apartment or a townhouse, and share ownership of the common property with every other lot owner.

A body corporate is the legal entity made up of all those owners, which administers the scheme, maintains the common property, holds the insurance and raises the levies.

So a property is not either strata or body corporate. It is held under a scheme, and the entity running that scheme has a name that depends on which state you are in.

In Queensland the entity is a body corporate and the arrangement is a community titles scheme, governed by the Body Corporate and Community Management Act 1997 and the regulation module that applies to the particular scheme.

New South Wales has strata schemes run by an owners corporation. Victoria has owners corporations. Western Australia has strata companies. The Australian Capital Territory uses owners corporations under unit titles legislation.

In everyday speech Queenslanders still say strata, and agents and lenders use the word freely. Nothing turns on that in conversation. It matters when you are reading a guide or a rulebook, because the rules attached to those words are not interchangeable.

A Queensland buyer following a New South Wales strata guide will find obligations that do not apply here, and will miss things that do.

Two examples make the point better than a terminology table.

New South Wales requires a ten-year capital works plan for a strata scheme. Queensland requires a sinking fund budget covering the current year and at least nine years after it, but does not require a professional forecast to produce it. Same intent, different obligation, and a Queensland buyer who assumes a formal plan exists may find there is none.

The regulation module is the other one, and it has no equivalent in the states people usually read about. A Queensland scheme is registered under one of several modules, which set out how the committee operates, how meetings run and what the body corporate can decide. Two Queensland schemes can work quite differently because they sit under different modules.

When you buy into a scheme here, the community management statement and the module it operates under are the documents that tell you what you are joining.