There’s a lot of chat around about funding the professionalisation of strata.
There are a few stirring the pot.
Chief among them is Strata Futures (aka Kate Hughes and John Minns). They have released a confidential report to their subscribers (including me) making the case for a national strata futures taskforce. They suggest it will cost $600,000 to $1m to establish this taskforce to centrally coordinate the efforts of various stakeholder groups to get a better outcome for all. More will be needed to keep it going. Kate and John aren’t the only ones talking about what it will cost to improve the outcomes for those who own and service strata.
GoStrata Media is on the scent as well. The blogger has a bee in his bonnet about supplier sponsorship of Strata Community Association. This week, he suggested that SCA supplier sponsorship (state and national) now exceeds $2.75M annually. GoStrata’s latest article on this takes a swipe at some of the lowbrow SCA sponsorship opportunities, like conference tea and biscuits and parties. He concludes that what SCA is arguably best at is raising sponsorship dollars. The clear inference is that the sponsors’ money could be better spent.
Meanwhile, at the annual conference of strata lawyers in Brisbane last week, over ‘self-funded’ tea, biscuits, and parties, there was a sense of despair about the future of strata. This group are perhaps the most acutely aware of the sectors challenges; conflicted fiduciary duties and business models; the increasing complexities of buildings and management arrangements, and continuous yet unharmonized reform programs for state-based strata laws. At this gathering, there was no sense of optimism that our challenges were being adequately addressed – not by government, not by strata managers, not by SCA and its suppliers, and not even by the lawyers themselves. It’s dire when lawyers become introspective.
This widespread malaise is why the suggestion of a national strata taskforce is worth exploring. Putting personalities and petty jealousies aside, together we might just be stronger, and better able to serve our more immediate constituents.
There should be plenty of money to do good things.
Strata data is patchy but let’s do the best we can.
How much do owners make from strata each year?
The average capital gain on units over the past year nationally is 7.2 % (Core Logic 2025). At $1.4 trillion replacement value of strata (City Futures UNSW), that’s new wealth for strata owners of $100B in2024 alone. Yet Owners Corporation Network has relatively few members, needs supplier sponsorship to stay afloat, and struggles to get owners to sign up for the $77 per annum membership fee.
How much do strata management companies make from strata each year?
There are 3.1 million strata lots nationally, with say 50 % under professional management. An average national fee of $453, means annual revenue of $702M. Valuing these businesses at $3 per $1 of contracted management fee revenue, strata management businesses in Australia have a current combined value of more than $1B. Yet, for example, in 2024 SCA NSW relies on supplier sponsor for $924,890 which is approximately 25% of its total revenue, while individual membership is $525 per year.
How much do banks make out of strata each year?
This is a hard one. It’s thought there is about $4B in strata bank accounts on any given day, earning no interest for owners, and being lent to their customers for home loans at an average of 6% pa. So that’s a lot. No wonder Macquarie Bank, ANZ and NAB either own, or partner with strata management software providers that give them access to these funds, while subsidising the software costs for the managers and owners. But the bigger banking picture is mortgage lending, and that brings the big 4 into play. Who would know how much they make from strata?
And the list goes on: insurers, professionals, trades, etc.
So, let’s stop pretending there’s no money. Let’s stop bickering about who’s the biggest or the best at (not) solving our many problems. Let’s take a stand together. There’s much at risk and much to be gained.
If this makes sense to you, shoot me a message. It might be time to pass the hat around.
Michael Teys advises strata management businesses on improving profitability through professionalisation and streamlined operating systems.
He has more than 30 years’ experience as a strata lawyer and academic and has owned 11 strata management agencies throughout Australia. He has a Master of Philosophy (Built Environment) and Bachelor of Laws. He lectures and writes widely about strata management issues in Australia and internationally.
