Australia Takes Lead in Condo Reform

September 2016

Sydney, one of Australia’s largest cities, requires housing to support its population growth. The local government has proposed updates to their condo act legislation to protect the interests of condo owners while ensuring growth in condo housing continues.

Much of this new housing is expected to come from urban renewal.

Condo corporations where a majority of 75 per cent of owners desire to sell their unit blocks for redevelopment will be able to do so regardless of the wishes of the minority. There will also be a guarantee of market value compensation plus relocation expenses for those required to sell. Distribution of proceeds from a sale would have to be equitable based on suite size.

This change is intended to balance the interests of vulnerable residents being forced to sell their homes and a majority who may be prevented from selling their homes by a minority.
Among other reforms enacted:

  • Protection against overcrowding in buildings
  • Greater authority to deal with noise, sub-leasing and misuse of visitor parking spaces
  • Allowing parking inspectors to ticket cars in building parking areas
  • Assistance to residents desiring to ban smoking by neighbours

One interesting change is new restrictions on proxy farming – one owner obtaining votes from unengaged owners. It is not uncommon for condo owners to not attend meetings because decisions are made in advance by virtue of proxy farming. The law now limits proxies to the lesser of one per owner, a maximum of 20%, or five votes.

Proxy farming reforms could make it more difficult to achieve quorum for meetings. The new laws will allow the chair to adjourn a meeting without quorum for seven days, or declare a quorum for a general meeting without regard to the number of eligible voters in attendance half an hour after the relevant business is called on for discussion.

Overcrowding is another concern in Sydney. Evidence of number of visitors can be used to enter condo suites for verification of residency. Fines for overcrowding would be raised to

In British Columbia, changes are also moving forward to facilitate urban renewal. These changes lower the threshold required to terminate a strata (condo corporation) from unanimous to 80% of eligible voters. This is part of what is being called a “winding-up resolution” which is taking on greater importance in a province with an aging stock of condo buildings.