Strata Law Changes — Effective 27 October 2025

What do the latest NSW strata law changes mean for owners and committees? On 27 October 2025, the next stage of reforms under the Strata Schemes Legislation Amendment Act 2025 came into effect, introducing stronger compliance powers for NSW Fair Trading, fairer financial hardship arrangements for levy payments, and new accountability rules for building managers.

On 27 October 2025, the next round of changes to NSW Strata Legislation commenced.

These changes include:

• Changes to Strata Levy Notices will mean that any Levy Notices issued from 27 October onwards, will need to include Financial Hardship Information Statements. This will include a requirement for Committees to provide fairer debt recovery requests including the ability to allow Owners to apply for payment plans.
• Building Managers are now subject to a statutory duty to act honestly and in the best interest of the owners corporation and must promptly being maintenance or safety issues to the owners corporation. They will also be required to disclose any benefits they receive under a contract or financial interest or relationships with suppliers or the developer of the scheme. Owners will also have additional grounds they can use to apply to the Tribunal to change or end a building manager agreement where a building manager has acted unlawfully.
• Fair Trading NSW receive expanded powers to ensure the owners corporations are being held to higher standards with their duty to maintain and repair common property. This will be achieved through the power to issue compliance notices where owners breach these duties. Fair Trading will also have power to issue penalty notices, seek enforceable undertakings and the ability to apply to the tribunal for an order against an owners corporation.

1. Owners and Committees should familiarise themselves with the above in order to make sure they remain compliant with future changes; this includes reviewing current scheme by-laws to ensure they are consistent with the changes.
2. For more information and in-depth updates on the changes, please visit the NSW Government website for strata law changes here.

Background

This is the second of three tranches of reform to strata law in 2025.

As highlighted by Fair Trading NSW, the State government expects that 50% of all residents in NSW will be living in strata schemes by 2050. These recent changes to strata legislation also reflect the government's desire to reach its housing targets by making strata living more effective for current and future residents.

In the Second Reading speech for the Amending Act released on 20 of November 2024, the Government's aim is stated to "improve accountability and confidence in strata managing agents and building managers" as well as to "enhance protections for owners from misconduct by strata managers" in a bid to meet the state's housing needs.

Further Changes to Come

In the last tranche of this reform, we will see:

• increased developer accountability, regarding initial maintenance schedules and levy estimates
• increased building manager accountability, by enhanced statutory duties
• provision for variation or termination of strata management and building management agreements by the Tribunal if carrying on business contrary to law
• mandatory training for strata committee members, however this change is still unclear as to specifics so watch this space
• levy collection and recovery of overdue levies – this will be a significant change which recognises costs of living pressures on owners and the need for certainty for owners corporation who cannot maintain buildings without the payment of levies
• expansion of investigative and enforcement powers of NSW Fair Trading, around information gathering powers, powers of entry, issuing compliance notices and enforceable undertakings
• new disclosure requirements in contracts for sale of strata lots to require disclosure of whether there are any embedded networks in a strata scheme, with provision for prescribed warranties covering same under sale of land conveyancing regulations

We have an experienced team of lawyers specialised in strata law to assist with any queries arising out of the most recent legislative changes.

For further information please contact:

Daniela Ter­ru­so, Senior Associate
Phone: + 61 2 9777 8342
Email: dxt@swaab.com.au

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.