A strata in property is a form of ownership where you individually own your unit — an apartment, townhouse, or sometimes a detached home — and share ownership of the land, the building’s structure, and all common spaces with every other owner in the development. The term is used in British Columbia, Australia, and parts of Southeast Asia; the same arrangement is called a condominium in the United States and most other Canadian provinces. Buying into a strata means taking on a mix of private ownership and collective responsibility, with shared costs, enforceable rules, and a governance structure that reaches into daily life.
How Strata Compares to Freehold and Co-op Ownership
Freehold ownership, also called fee simple, gives you the building and the land outright. You decide what gets repaired, when it gets insured, and how the property is modified. Strata splits that up. Your unit is yours, but the land, building shell, and shared spaces belong to all owners together. Shared ownership means shared costs and shared decisions, which freehold owners never deal with.
A housing cooperative is different again. In a co-op, you don’t own a unit at all. You own shares in a corporation that owns the whole building, and those shares let you occupy a specific unit. In a strata, your unit is real property with its own legal title. You can sell it, mortgage it, or leave it in your will without needing approval from other owners. That has a practical consequence at purchase: strata units can usually be financed with a standard mortgage, while co-op financing is harder to arrange because you’re buying shares rather than property.
What You Actually Own in a Strata
Your Lot
In a strata, your unit is called a lot. You own the interior space, generally from the inner surface of the walls inward and the upper surface of the floor upward. The exact boundaries are drawn on the strata plan filed at the land title office, and your lot has its own title. That title is what lets you sell, rent, or borrow against your unit on your own.
Common Property
Everything that isn’t inside an individual lot is common property. That covers the exterior of the building — roof, outer walls, foundation — along with shared interior spaces like hallways, lobbies, elevators, and stairwells. It also covers amenities such as pools, fitness centres, gardens, and parking areas, plus the pipes, wiring, and ducts that serve multiple units.1Province of British Columbia. Common Property and Limited Common Property in Stratas All owners collectively own the common property, and the strata corporation controls how it is maintained and used.
Limited Common Property
Between your lot and the fully shared common property sits a category that confuses many buyers. Limited common property is common property reserved for the exclusive use of one or a few specific lots. Balconies, patios, assigned parking stalls, and storage lockers are the usual examples. You get exclusive use, but the space still legally belongs to all owners.
Limited common property is created either when the developer files the original strata plan or later by a three-quarter vote of the owners.1Province of British Columbia. Common Property and Limited Common Property in Stratas The distinction matters most when something breaks. The strata corporation generally maintains common property, but bylaws can shift some repair duties for limited common property to the owner who uses it. You might have to maintain your balcony deck surface, for instance, even though you don’t technically own it.
The Strata Corporation and Council
When a strata plan is registered, a strata corporation is automatically created as a separate legal entity. Every lot owner becomes a member. There is no application, no opt-in. In Australia the same body is often called a body corporate or owners’ corporation. Whatever the label, the role is the same: maintain common property, manage the development’s finances, and enforce the bylaws and rules.2Province of British Columbia. About Strata Corporations
Day-to-day management is run by the strata council, a group of owners elected at the annual general meeting.3Government of British Columbia. Strata Councils The council prepares budgets, collects fees, hires contractors, supervises maintenance, and enforces bylaws. Members are volunteers, and they owe a fiduciary duty to the strata corporation as a whole, not to any individual owner or voting bloc.
Major decisions happen at general meetings. Most resolutions pass by a simple majority, but significant actions — amending bylaws, approving special levies, designating limited common property — require a three-quarter vote.4Province of British Columbia. Conducting an Annual or Special General Meeting in a Strata A few actions, like changing how a special levy is split among owners, require unanimous approval.
Strata Fees, Reserve Funds, and Special Levies
Regular Strata Fees
Every owner pays regular strata fees, sometimes called levies or assessments, to cover the operating costs of common property. These fees fund routine maintenance, utilities for common areas, building insurance premiums, property management, and contributions to the contingency reserve fund. The amount you pay is typically proportional to your unit entitlement, a share assigned to each lot based on factors like size or value and recorded on the strata plan. A larger unit pays more than a smaller one.
The Contingency Reserve Fund
Part of your fees goes into a reserve fund set aside for major future expenses like roof replacement, elevator overhauls, repaving, and structural repairs. In British Columbia, strata corporations must contribute at least 10% of their annual operating budget to the contingency reserve fund each year.5Province of British Columbia. The Contingency Reserve Fund (CRF) in Strata Corporations Other jurisdictions set their own minimums.
To plan for those costs, strata corporations commission depreciation reports, called reserve fund studies in some provinces. These reports estimate the remaining useful life and replacement cost of major building components over a 30-year horizon. In BC, any strata with five or more lots must obtain one on a five-year cycle, and the option to defer by annual vote has been eliminated.6Province of British Columbia. Strata Depreciation Reports A healthy reserve is one of the strongest signs of a well-managed strata. When the reserve is underfunded, the bill for major repairs lands on owners all at once.
Special Levies
A special levy is a one-time charge to owners for expenses the regular budget doesn’t cover. Emergency repairs, infrastructure failures, and costs that exceed the reserve are the usual triggers. In BC, a special levy requires at least a three-quarter vote of owners. It is normally divided among owners by unit entitlement, the same way regular fees are split. Dividing the cost differently, such as charging ground-floor owners less for a roof replacement, requires a unanimous vote.7Province of British Columbia. Special Levies in Stratas
Special levies can run into tens of thousands of dollars per unit, and they come due whether you voted for them or not. This is the financial risk that catches new strata owners off guard most often. It is also the main reason to review the reserve fund and depreciation report before buying.
Bylaws and Rules
Strata communities run on two layers of governance. Bylaws cover the strata corporation’s operational structure: how meetings are run, how the council is elected, what happens when owners fall behind on fees, and how common property can be used. Amending bylaws requires a three-quarter vote at a general meeting.4Province of British Columbia. Conducting an Annual or Special General Meeting in a Strata
Rules are more granular and cover day-to-day matters like noise, pets, move-in procedures, and use of recreational facilities. The council can create or change rules, but they have to be ratified at the next general meeting to stay in effect.
When someone breaks a bylaw or rule, the strata corporation can impose fines, but only after giving the owner or tenant written details of the complaint and a reasonable chance to respond, including a hearing if asked for. The bylaws must spell out the maximum fine for each type of violation, and those maximums cannot exceed the caps set by regulation.8BC Laws. Strata Property Act Bylaws are not optional, even for rules you disagree with or that weren’t in place when you bought. The way to change one is to propose an amendment at a general meeting.
Insurance Is Split in Two
Strata properties run on a split insurance structure, and misunderstanding it is one of the more expensive mistakes new owners make. The strata corporation buys a master policy covering the building’s structure and common property: exterior walls, roof, foundation, hallways, elevators, amenities, and the mechanical systems serving the building. Premiums for this policy come out of strata fees.
The master policy does not cover your personal belongings, interior upgrades you’ve made, or your personal liability. For those you need your own unit-owner policy, known in North America as an HO-6 policy. It covers your furniture, electronics, and clothing, plus any improvements beyond the standard finishes the developer originally installed: upgraded flooring, custom cabinetry, renovated bathrooms. Your personal policy also carries liability coverage. If your dishwasher overflows and damages the unit below, your liability coverage responds, not the building’s master policy.
One endorsement worth asking your insurer about is loss assessment coverage. If the strata corporation issues a special levy to cover damage from a covered peril, such as a fire that exceeded the master policy’s limits, loss assessment coverage on your personal policy can offset your share of that cost. Not every policy includes it by default, so confirm before you assume you’re covered.
What to Review Before Buying a Strata Unit
The financial health of the strata corporation affects your investment as much as the condition of the unit itself. A freshly renovated kitchen means nothing if the building needs $40,000 per unit in structural repairs next year and the reserve fund is empty. Before you commit, request and review these documents:
- Depreciation report or reserve fund study. Check the reserve balance against upcoming major expenses. A strata with an aging roof, 15-year-old elevators, and a thin reserve is a special levy waiting to happen.
- Meeting minutes from the last two years. Council and general meeting minutes reveal ongoing disputes, deferred maintenance, insurance claims, and pending special levies that no one will mention in the listing description.
- Operating budget and financial statements. Watch for a deficit, consistent underfunding of the reserve, or significant accounts receivable from owners who aren’t paying.
- Bylaws and rules. Know what restrictions you’re agreeing to. Pet bans, rental restrictions, and renovation approval requirements all live here.
- Insurance certificate. Confirm what the master policy covers and identify the gaps you’ll fill with your own unit-owner policy.
In BC, any strata with five or more lots must have a current depreciation report.6Province of British Columbia. Strata Depreciation Reports If the strata you’re considering doesn’t have one, or if the report is outdated and the council has been slow to commission a new one, treat that as a signal about how the building is being managed. The few hundred dollars and few days it takes to review these documents before closing can save you from a five-figure surprise in your first year of ownership.