The 小蓝视频 government announced today (Jan. 24) that it is implementing changes to strata regulations to better protect strata owners, and mitigate the high cost of strata insurance.
The amendments to the Strata Property Act are designed to eliminate confusion and clean-up or correct areas of contention, Tony Gioventu, executive director of the Condominium Home Owners Association of 小蓝视频, told Glacier Media.
“These are not big changes,” he said. “These things are just housekeeping.”
These include changing the minimum amount developers or strata owners must contribute to their contingency reserve fund (CRF) – savings all strata corporations in 小蓝视频 are required to have in order to pay for certain expenses or for emergencies.
Effective Nov. 1, 2023, the minimum CRF contribution amount per year will be 10 per cent of a strata’s annual operating expenses, up from the existing requirement of five per cent.
According to Gioventu, the majority of stratas are already setting at least 10 per cent of their annual operating expenses. Only a very small number of the roughly 34,000 strata corporations in 小蓝视频 will be affected by the amendment, he said.
Developers will also be required to include a CRF contribution to a new building's interim budget that is equal to at least 10 per cent of the building’s operating expenses, according to the Ministry of Housing.
The change follows a December 2020 recommendation from the 小蓝视频 Financial Services Authority, which suggested that improved maintenance and risk-mitigation is needed in order to reduce pressure on strata insurance premiums and deductibles.
“This is really helpful because in the first year, strata corporations may be faced with emergencies, or they may be faced with issues where they need things that are not funded for in their annual budget. They'll at least have some resources to be able to do that,” said Gioventu.
The Ministry of Housing also noted that this will prevent developers from advertising unrealistically low strata fees to prospective buyers.
Effective April 1, strata corporations must also include a summary of their insurance coverage in their Form B information certificate, which is typically requested by and issued to prospective buyers.
“We've been asking for this for a long time. It's good news for people who are buying into condos to have a good look at the insurance status for a building before they make their purchase,” said Gioventu.
