US Strata Enjoys Independence Day

It’s the 4^th of July and American Independence Day so let’s look at some facts about US Strata.

Interestingly, while US strata is like Australian strata there are many differences.

Firstly, the USA property titling system is not torrens based (or government registered and guaranteed).  Rather, it is more like old system where you need to show a documented chain of ownership back to settlement times and that risk is covered by title insurance.

Secondly, there is a difference between vertical multi-title systems (for apartments and other overlapping dwellings) and horizontal multi-title systems (like community schemes).   Vertical schemes are called condominiums and are governed by legislation and scheme based documents (like our strata title).  Horizontal schemes are called Community Associations and are not covered by legislation but rather operate under land title covenants that attach to each property.

Thirdly, condominium laws are state based so there are 52 sets in the USA.  And they vary from very detailed and prescriptive (like in California and Nevada) to very simple and basic in other parts of the country.

There are condominium and community association managers right around the USA.  They’re regulated in some (but not most) of the 52 states and owners trust accounts are protected  (where required) by fidelity bonds.

There’s a national association for managers, scheme suppliers, condominiums and community associations and other interested people called the Community Associations Institute.  It’s been around for 40 years, operates via 60 regional chapters and is a seriously large and active organisation. You can find out a lot more about the CAI (not the CIA) here.

Schemes seems to face the same challenges as in Australia (and everywhere) including ongoing repair and maintenance, overdue levies, risk management on common areas, rule or by-law compliance, renovation disputes, internal disputes about decisions, building defects and problems with KLAP (kids, laundry, and pets).

 

Latest data suggests that in the USA there are –

• 305,000 condominiums & community associations
• 24.4 million lots
• 60,000 community association & condominium managers working in over 10,000 companies
• over $4 trillion in property values (about 20% of the total value of US residential real estate)
• an estimated $41 billion in annual turnover
• an estimated 35 billion invested for long term maintenance & capital works
• 60,100,000 people living in community associations

* Source CAI media contact: Frank Rathburn, VP, Communications (703) 797 6261, frathburn@cailonline.org

So, in the USA there’s a huge strata sector doing lots of interesting stuff from which we can learn many things.

Francesco …