The Yin-Yang of Overseas Strata Owners

I recently read a few interesting articles that illustrated the yin-yang of overseas strata owners in Australian strata.

The Chinese concept of yin-yang, literally meaning "shadow and light", describes how polar opposites or seemingly contrary forces are interconnected and interdependent in the natural world, and how they give rise to each other in turn in relation to each other.

So, why are overseas strata owners a yin-yang strata issue?   

On the one hand it appears that an increasing number of strata owners live overseas.  They're attracted to Australian real estate investment by its stability and foreign investment laws make it relatively easy to buy and won in Australia.  And that's a good thing for Australian strata as this article Foreign Investment in Australia's Property Market by Strata Community Australia explains.

On the other hand overseas strata owners can cause serious strata grief when they don't pay their levies.  That's because strata laws are state based and legal action against people who are not Australian residents and/or not present in the state are more complicated.  Usually they need to be taken in superior courts (so are more costly) and things like service and enforcement action are more difficult without Australian addresses.

This was recently highlighted in a Victorian VCAT case about strata levies called the Sivanesan Case.  You can read more about the problems over strata levy recovery in these articles (The Challenge of Foreign Investors by SCA) and (page 6 article Recovering Fees from Overseas Owners by SCA VIC) and look at the Sivanesan Case judgement here.

So, as much as Australian strata wants and needs overseas strata owners to maintain growth and investment in the sector, they can pose a serious legal and cash-flow impact on strata corporations when they don't pay their strata levies.

It's a yin-yang strata thing.  Or, to put it another way "the sweet is never as sweet without the sour". 


Francesco ...