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Owners’ Corporation Law - May 2015

28 Apr 2015

Owners’ corporations are a powerful democratic force – if only they knew.

I’ve said this before, and I’ll say it again – it is well worthwhile and overdue for an in-depth analysis of owners’ corporations from policy analysts in the government sector on the affordability, sustainability, amenity, privacy and livability of persons living in and communities living together in high-rise towers.

We have all seen the cranes around town, and the real estate advertisements in the papers – Melbourne has a glut of residential apartment buildings, with many more on the way.

For too long, the government policy in this area went too far in favour of developers, leading to the creation of those shoebox 30sqm apartments with little or no natural light. In some extreme circumstances, developers would assign long-term management rights agreements to themselves, their friends or subsidiary companies they control and for un-commercial terms and remuneration.

We saw in the latest round of state elections late last year, that the City of Melbourne seat became a closely-run contest between Labor and the Greens. In the lead-up to that election, both candidates pledged sweeping reforms in key areas of concern for owners’ corporations.

However, as is often the case, once governments are formed and agendas are set, things move fairly slowly. It is time for owners’ corporations throughout Melbourne to form a cohesive, committed and effective lobbying group, and to open the lines of communication with the political sphere.

Take for example – the short-term letting issue in Victoria. There has been much media attention about an owner’s right to let or license their apartment for short-term stays.  However, any reform in this area will take years – despite the recommendations that will come out of the working party formed for this inquiry.

In 2014, Airbnb, the giant accommodation service provider, raised $800 million US in venture capital, the majority of which it has pledged to spend on securing and shoring up their business model. Airbnb will spend hundreds of millions this year on lobbyists, public relations firms, and on teams of lawyers whose sole aim will be to ensure that Airbnb is neither legislated against nor otherwise outlawed. In addition, the business giant will bombard the public with soft advertising campaigns, sponsorship deals, fundraising initiatives and other types of marketing in the UK, Europe, South America and Australia.

Any owner or resident living in a tower that struggles with the effects of short-term letting will shortly not have an effective and audible voice in this campaign, and will not be able to raise their voice above the cacophony of the lobbyists and slick PR machines that Airbnb and others employ to scream at the policymakers and politicians.

The question is – can the owners’ corporations of Victoria band together as a unified voice on this topic and others, and in time to make a difference?

As a single block of voters comprising may thousand residents, the owners’ corporation ‘vote’ can and would make a difference to the outcome of any election in this state.

It is a pity there is not another election anytime soon.

Tom Bacon is the principal lawyer of Strata Title Lawyers.

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