Industry Update: An Outlook for 2022 and Beyond

Wow – what a crazy couple of years… Can we just forget and write off 2021 and start again?

Well not really, after all the Covid-19 lockdowns, emails going mad, trade embargos, Olympic and Para-Olympic Games with nobody there and everything else in the world we actually did do a lot and a lot of things happened in StrataLand in 2021…..

I’ve done a little crystal ball gazing and given some thought to see where we are going as an industry. In order to do that we have to look back in order to consider what may happen into the future.

Recently I attended the SCA (NSW) Conference where SCA launched the fantastic book into the history of strata title by my good friend John Coleman “From the Ground Up”. I started to read it (after of course checking to see if I was in there – and I was….woohoo) and low and behold there it was, page 29, the first set of statistics in strata on disputes (1980)….. the three major areas of dispute before the Strata Commissioners office were:

1. Breaches of By-laws;

2. Poor construction of buildings; and

3. Faulty meeting procedures.

I cried with laughter, here we are 41 years later and what are the hot topics, the same 3……. , I emailed my friend in Canada (a strata lawyer) and she replied, OMG, same 3 here…….. we are not alone!!

Where are we headed?

So, after that revelation (well not really for all of us “in the know”) where do I see the industry heading. Some of my comments in 2018 (way before Covid-19) still ring true, we are getting smaller size properties for more money (a decrease in land size and apartment size compared with an increase on price per square metre), we have an increase in supply but still not reaching demand (in some cities), and there are more buildings being built (but are we heading for a “mid-life financial” crisis like we had in 2009/10).

How does it affect our industry?

With the increasing volume of lots coming onto the market, the ever-increasing complexity with titling across the country, the undersupply of stock in some areas and most major states/territories implementing or undertaking legislative review, we as an industry are in for a wild 2022 and beyond.

NSW has already started with about 10 legislative reviews, a new Community title legislation and many changes to the current strata legislation (and more coming), WA has had a go and got things moving on legislation, NT has done some changes, Tasmania made some changes and QLD is now under a full review.

So, it will be moving feast in 2022 on the legislation front across the eastern States.

Where do I see the challenges for 2022 and beyond?

There are plenty more major challenges than I have proposed here that we face as an industry:

1. Technology – technology is taking over our lives. If you can’t get it instantly it isn’t worth having. We want it and we want it now. In managing buildings this will be an ever increasing challenge as technology moves at a rapid pace. We are facing this in NSW with the increase in acceptability in legislation for technology. 

a. Meetings being held on line (watching the “worm” move from yes to no as owners enter their vote);

b. Video conferencing for meetings;

c. Managers having technology with them wherever they are and issuing work orders, notices, photos on problems whilst they are standing onsite or at a meeting; 

d. Greater access to building information (notices, minutes, web sites, work scheduling); and 

e. Greater sense of community and access to community events.

2. Legislative review – this train won’t stop. Each region has its own unique legislation and views on title structures, procedures and dispute resolution. We are getting closer and with the advent of the Professional Standards Scheme in NSW (and hopefully coming across the country), and businesses now crossing borders more and more this creates opportunities for harmonisation of laws. However, having “harmony” in laws is something I gave up on a long time ago I think we stick with as the song goes, “just love the one your with”.

The industry will continue to grapple with changing laws in each jurisdiction and we must all be diligent in making sure that things don’t go to astray.

3. Construction – there are so many facets to this topic that you could write volumes, but developers/builders need to have confidence in the market and consumers need to feel that what they are purchasing won’t fall down around their ears (seems to be a theme from at least 1980!).

Certification of building construction and the ensuing construction defects will continue to be a major impact on the lives of all those in the industry from owners through to managers and suppliers. NSW has embarked on a compliance system with force under the Building Commissioner’s powers and I am sure the rest of the country is watching to see the results. Let us hope that it isn’t a migration out of NSW like before when insurers left the construction market as it was too hard.

4. Lot owners – owners are becoming more involved in the daily activities of their buildings. They are asking more, listening more and want to be involved in the decision making process. Going hand in hand with that they are now more demanding of service from providers. Trying to find the balance between service and expectations will continue to be a challenge to all of those involved in the industry. So, meetings will continue to be fun (2 down from 1980).

5. By-law breaches – everyone is having a go at this little gem. Not everyone should live in strata, let’s be honest. Compliance with a set of rules that you don’t make is hard, even harder when you want what you want and stamp your feet to get it.

Committees will continue to struggle to balance reasonable by-laws versus the expectations of an ever-increasing diverse group of owners. The balance will always be as to how to regulate them, so they don’t unfairly interfere with anyone else’s lives. We need tough regulation, power to the owners to enforce them (in some cases), very steep penalties and a regime to allow the good ones to get on with business/ living (no. 3 from 1980 covered).

In conclusion, in 2016 I said in an article, it was to be “the beginning of the fastest rise in the strata industry for a while to come”. And in 2018 I said we were running as fast as we can because of it. Well team, now I am saying look out here it comes – 2022 with a vengeance!! – we didn’t run fast enough…..