Most New South Wales apartment owners prefer to pay higher service management fees than have their strata manager paid commissions on insurance policies.
An Australian Apartment Advocacy (AAA) perceptions survey of 761 apartment owners found a clear gap between apartment owner expectations of transparency, communication and responsiveness and actual strata performance.
Apartment owners cited “pain points” including slow response times, poor communication, lack of leadership and guidance, lack of transparency, inefficient management and high fees.
When asked whether they would prefer to pay higher service fees with no insurance commission paid to strata managers or lower service fees with insurance commissions paid to the strata manager, 63.8 per cent selected the higher fee, no commission option.
The 2024 Strata Management Consumer Insights Report follows intense media scrutiny of strata managers in recent months, with revelations some strata managers received undisclosed payments for recommending some insurance policies over lower-priced alternatives.
AAA CEO Samantha Reece says the sector needs to address the “expectations gap” with transparency, effective communication and education of strata managers. “This is an opportunity for the strata sector to improve its reputation with total transparency, quality communication, accountability and better governance,” Ms Reece says.
The results of the survey made it clear that owners seek greater transparency from strata managers about their responsibilities, finances and building maintenance.
Ms Reece says while 36.2 per cent of owners said they would prefer to have lower fees in return for their owners corporations receiving commissions from insurance companies, a concerning 32 per cent of owners said they had not been informed that their strata agent was receiving insurance commissions.
Ms Reece says the report provides valuable insights for improvement for strata managers.
“We are facing unprecedented housing shortages in NSW,” Ms Reece says. “More professional strata management transparency and service will give consumers greater confidence in the apartment sector.”
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