‘Bullying, death threats and a whole lot of lies’: How to solve the strata sector’s big problem

Inexperienced strata committees are at risk of being overrun by self-serving members who could derail progress to solving major issues, according to a leading industry figure.

Australia’s strata sector of more than three million units needs a wake-up call around who is responsible for solving problems within strata schemes, according to former NSW Strata and Property Services Commissioner John Minns.

Speaking to property professionals at the industry conference Navigate 2025, hosted by Regrowth Consultancy, Mr Minns said the growth of the apartment sector meant the challenges of the strata industry could no longer be ignored, and the onus should be on owners to take charge.

“I’m an absolute advocate for strata living,” he said. “But we can’t have rose-coloured glasses when it comes to the strata sector.”

Mr Minns said a key issue in the strata sector was that owners of apartments were too often motivated to keep strata levies low.

However, focusing on cutting costs could be counterproductive when it came to preventing major problems, he said.

“One thing I’ve heard from owners time and time again is ‘the strata is hopeless,’” he said.

“But what the poor old owner is blissfully unaware of is they actually are the strata, so they’re talking about themselves.”

Former NSW Strata and Property Services Commissioner John Minns said Australia’s strata sector needed a wake-up call. Picture: Supplied

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‘Owners heading for the exit’

Mr Minns described an alarming example of a strata scheme of more than 800 units that was beset with turmoil after significant building deterioration and water ingress were discovered in 2016, which would be extremely costly to repair.

“No one was delighted about how much that would cost, but they made the decision to proceed with the work because they believed it was going to enhance values and protect the assets within the $500-million-plus complex,” he said.

“What they had no idea about was the toll this would take on the community, and it was huge.”

Uncertainty around where responsibilities lie is a major issue within strata schemes, according to former NSW Strata and Property Services Commissioner John Minns.

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What followed was an overthrow of the strata committee and the abandonment of plans to deal with the issue, Mr Minns said.

“A small group of disgruntled owners engaged in an escalating campaign to destabilise the entire community,” he said.

“This included bullying, death threats and a whole lot of lies, and finally, proxy harvesting around an annual general meeting to install what was effectively a puppet committee to ensure that this commitment wasn’t undertaken in the future.”

Mr Minns described the result as “scary”, with building works halted and committee members helping themselves to the scheme’s shared funds.

“We had self-serving expenditure starting to happen on individual strata committee members’ properties, against the interest of the owner’s corporation,” he said.

“We had multiple tribunal hearings because of the level of dispute that came up, and we had owners heading for the exit at a fairly rapid rate.”

However, Mr Minns said the horror story did eventually have a happy ending.

“Eight years after the initial diagnosis, the community did manage to fight back,” he said.

“A significant majority of owners voted to approve a seven-figure special levy — at great cost to themselves and at a much higher level than it would have been back in 2016 — to fix the building.”

“They voted out the dissidents, installed a professional committee and were working hand-in-hand with strata building managers.”

“This year that committee was re-elected to finish the job that they started.”

Absence of responsibility

Mr Minns said a key issue facing the strata sector was the fact that many owners in strata schemes didn’t realise what their responsibilities were, deferring instead to building managers to take charge.

Another problem was the heavy burden placed on strata committee members, who often weren’t equipped for the challenges that could crop up.

“Generally speaking, people who sit on strata committees are those who have got time,” Mr Minns said.

“But they’re unpaid, they carry major legal obligations, and in most cases, they’ve got no professional experience running a multi-million-dollar property asset.”

Mr Minns said a “race to the bottom” in building management fees had led to an erosion of trust in strata managers, who he said often came to resemble “glorified admin assistants”.

A focus on keeping strata fees low could create problems further down the track, Mr Minns said.

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He said solving the issue would require strata managers to feel empowered to appropriately advise owners, who were the real decision makers in a strata scheme, on where money needed to be spent.

“We need them to be prepared to provide that really strong advice to an owner’s corporation, not what they want to hear but what they need to know,” he said.

Intelligent investment

Mr Minns said it was crucial to educate investors in the importance of prioritising maintenance to preventing problems from spiralling out of control, rather than focusing on cutting costs.

“Investors should be leading the calls within an owner’s corporation for intelligent preventative maintenance and investment,” he said.

“A building can slip into disfunction or dilapidation within two years if owners corporations fail to meet their obligations to maintain and repair common property.”

“Investors who are seeking a return on their investment often see keeping strata levies down as their main priority, and yet in any intelligent world, this flies in the face of asset management and value optimisation.”

“Most people in this case need to have advice about how they need to invest in order to make the greatest gains, which generally come from property value appreciation, not from cost control upfront.”

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Mr Minns said the rapid pace of growth in apartment living meant the issue, and the opportunity to solve it, would become bigger in the future.

“50% of Greater Sydney residents are expected to live in strata by 2040 – it’s 17% at the moment,” he said.

“If we’re looking towards the horizon, this challenge is a profitable one and is going to create more and more opportunities.”