NSW strata report: what's in it and what to check before you buy

A building inspection tells you about walls and wiring. It won't tell you that the owners voted last month for a $40,000-per-lot waterproofing levy, or that the by-laws ban the dog you were going to bring. The strata records will. This guide explains what's in a NSW strata report and the order to read it in.

What a strata report is

In NSW, the owners corporation must keep records: the strata roll, minutes, financial statements, the 10-year capital works fund plan, insurance policies, notices and correspondence (Strata Schemes Management Act 2015 (SSMA), s 180). Under s 182, an owner, or someone the owner authorises in writing, can inspect them. That is how a buyer gets in: the seller signs an authority, and you or your inspector pay the inspection fee set in the regulation. For an authorised person it is currently $60 for the first hour (Strata Schemes Management Regulation 2016, Sch 4).

A strata report is what a professional strata inspector produces from those records. NSW Fair Trading recommends getting one, along with a building and pest inspection (buying a strata property). Quality varies a lot. Some reports copy out the minutes, others summarise and flag. Either way, the report is only as good as the records the strata manager made available, so check which records it covers and for how many years.

What the contract does and doesn't tell you

The contract for sale of a strata lot must attach the property certificate for the lot and the common property, the strata plan and the by-laws (Conveyancing (Sale of Land) Regulation 2022, Sch 1). It doesn't have to disclose levies, special levies, defects or disputes. That's what the strata report is for.

The strata information certificate

The strata information certificate (once called a section 109 certificate) is a different document. It's issued by the owners corporation under s 184 and shows the regular levies, any unpaid levies including special levies, interest, funding proposals in the 10-year plan, and the strata manager's details. In favour of a buyer, it is conclusive evidence of the amounts owing as at its date (s 185). Under the standard contract, the seller has to serve one at least 7 days before completion. That is useful at settlement, but it comes too late to help you decide whether to buy.

1. Levies

Start with what you'll pay.

• The levies for this lot. Quarterly administrative fund and capital works fund levies, set by unit entitlement (s 83). Compare with similar buildings nearby. Low levies are not automatically good news: Fair Trading warns that levies kept too low can lead to special levies later.
• The trend. Compare this year's budget with the last two or three. A sudden jump suggests catch-up; years of flat levies in an older building suggest a catch-up still to come.
• Arrears on this lot. A new owner is jointly and severally liable with the previous owner for levies and interest unpaid when they become owner (s 84). The contract makes the seller pay them at settlement, but you want to know.
• Arrears across the building. Unpaid levies earn simple interest at 10 percent a year once they are a month overdue (s 85). A building where many owners are behind is short of cash, and the owners who pay carry the gap.

2. The two funds and the 10-year plan

Every owners corporation has an administrative fund for day-to-day costs such as insurance, cleaning and minor repairs (s 73). It also has a capital works fund for painting, repairing and replacing common property and other big-ticket items (s 74).

The capital works fund is guided by a 10-year capital works fund plan (s 80). It sets out the work expected over 10 years, when, what it will cost, and how it will be paid for. It must be reviewed at least every five years, and plans prepared since 1 April 2026 must use the standard form. Check three things:

1. Does the plan exist, and is it current? No plan, or one long overdue for review, is a finding in itself.
2. Does the balance match the plan? Compare the actual capital works fund balance with the balance the plan projected for this year.
3. Are the levies following the plan? The levies set at each AGM must take the plan into account (s 79), but the plan is only followed so far as practicable. If the owners have voted for lower contributions than the plan calls for, the gap usually returns later as a special levy.

Our guide to special levies and the capital works fund goes through how to read the plan in detail.

3. Special levies

A special levy is an extra contribution for costs the funds can't meet. It's raised by a resolution at a general meeting (s 81(4)). Look for them in three states:

• Struck. Already resolved. Note the total, this lot's share, the due dates and whether instalments remain.
• Proposed. Quotes being sought, a motion on the next agenda, an engineer's report recommending works.
• Likely. Large works due in the 10-year plan with a fund that can't cover them.

Who pays a levy struck before settlement depends on the contract and when the levy was determined. The special levies guide explains the standard contract's rules; your conveyancer should confirm them for your contract.

4. Defects and building work

This is where the largest bills come from: waterproofing, cladding, concrete cancer, balconies, fire safety, lifts.

• Reports. Look for building defect reports, engineering reports, fire safety statements and any orders from council or the NSW Building Commission.
• Newer buildings. For many new buildings over three storeys, the developer must lodge a strata building bond of 2 percent of the contract price, with defect inspections at around 15 to 18 months and 21 to 24 months after completion (SSMA Part 11; Fair Trading: strata building bond and inspections). If the building is in that window, find out where the inspections are up to.
• Claims. People who carry out construction work owe current and later owners a duty of care to avoid economic loss caused by defects (Design and Building Practitioners Act 2020, s 37). A claim against a builder can recover money, but it takes years and costs legal fees in the meantime.
• In the minutes. Repeated complaints about leaks, water ingress, cracking or the same lift breaking down.

If you find a defect, ask how the repair will be funded and whether a special levy is planned.

5. By-laws

The by-laws are attached to the contract, but read them as rules you will live under. Changes are made by special resolution and only take effect once registered (s 141), so check the minutes for any change passed but not yet registered.

• Pets. A by-law can't unreasonably prohibit keeping an animal (s 137B). Still, read what the by-laws say about keeping one before you rely on it.
• Short-term letting. A by-law can prohibit short-term rental accommodation, but only for lots that aren't the host's principal place of residence (s 137A).
• Renovations. Rules on flooring, kitchens, bathrooms and approvals.
• Exclusive use. By-laws that give a lot exclusive use of common property, such as a courtyard or car space, often make that owner responsible for its upkeep.
• Limits on by-laws. A by-law can't stop you selling or leasing your lot, and can't be harsh, unconscionable or oppressive (s 139).

6. Disputes

Strata disputes go to free mediation through NSW Fair Trading first (s 218; applying for strata mediation). If that fails, they go to the NSW Civil and Administrative Tribunal (NCAT), which can make orders to settle disputes about how the scheme is run (s 232). Look in the minutes and correspondence for mediation, NCAT applications, legal advice and solicitors' letters. One noisy-neighbour complaint is normal. A long-running dispute between owners and the committee, or legal costs paid from the administrative fund, is worth asking about.

7. Insurance

The owners corporation must insure the building for replacement and reinstatement (s 160, s 161). It must also hold public liability cover of at least $20 million (SSMA s 164; Regulation cl 40), plus workers compensation where required. Check:

• The policy is current, and the sum insured is in line with a recent valuation.
• The excess, and any exclusions (some insurers exclude known defects or flammable cladding).
• Claims history and premium increases. A big increase lands in the administrative fund levy.

8. Minutes

Read the minutes of the last two or three AGMs and the committee meetings in between. They show what the owners are worried about before it reaches the financial statements. Search for: special levy, quote, engineer, leak, water ingress, defect, cladding, NCAT, mediation, solicitor, insurance claim, arrears and by-law.

Red flags

• A special levy struck or proposed, and you don't yet know who pays it.
• A capital works fund well below the 10-year plan's forecast, or no current plan.
• Defect reports with no funded repair plan.
• An insurer declining cover, a large excess, or exclusions for known problems.
• Ongoing NCAT proceedings or legal costs.
• High levy arrears across the building.
• By-laws that rule out how you plan to use the lot.
• Records missing from the report, or only a few months covered.

Questions to ask

1. Are any special levies struck, proposed or being discussed? How much would this lot pay, and when?
2. What major works are in the 10-year plan for the next five years, and is the fund on track?
3. Are there any defect reports, building orders or claims against the builder?
4. Is the owners corporation in any dispute, mediation or NCAT proceeding?
5. When was the building last valued for insurance, and have any claims been declined?
6. Are there by-law changes passed but not yet registered?
7. What are the arrears across the building?

A reading order for the report

1. Levies and arrears for this lot.
2. Capital works fund balance against the 10-year plan.
3. Special levies: struck, proposed, likely.
4. Defect and engineering reports.
5. Minutes for the last two or three years.
6. Insurance.
7. By-laws.

Then talk to your conveyancer before you exchange. If there's a cooling-off period, it's usually five business days (Conveyancing Act 1919, s 66S), and there's none at auction.

Check the report with FileAI

Strata reports run to hundreds of pages, and the line that matters is easy to miss. FileAI's strata report check reads the whole report and lists every levy, special levy, defect, dispute, insurance issue and by-law, each linked to its page, with a red, amber or green call for each area and the questions to ask before you bid. The preview is free with no signup; the full check is A$29 per report (AUD), with a 14-day money-back guarantee.

Sources

• NSW Legislation, Strata Schemes Management Act 2015, ss 73, 74, 79, 80, 81, 83, 84, 85, 137A, 137B, 139, 141, 160, 161, 164, 180, 182, 184, 185, 218, 232 and Part 11
• NSW Legislation, Strata Schemes Management Regulation 2016, cl 40 and Sch 4
• NSW Legislation, Conveyancing (Sale of Land) Regulation 2022, Sch 1 and Conveyancing Act 1919, s 66S
• NSW Legislation, Design and Building Practitioners Act 2020, s 37
• NSW Government, Buying a strata property, Levies, finances and insurance, Applying for strata mediation and Strata building bond and inspections scheme
• Law Society of NSW, Contract for the Sale and Purchase of Land, 2026 edition, clause 23

This guide is general information, not legal or financial advice. It reflects NSW law as at October 2026, and strata law changed several times in 2025 and 2026. Ask your conveyancer or solicitor about the lot you're buying.