Introduction

If you are looking at purchasing a condominium, apartment, or villa within a development/complex (as opposed to a standalone house or villa) in the Turks and Caicos Islands (“TCI”), title to the property will either be what is known as a “strata title” or will be part of a Homeowners' Association. This article aims to give you a brief introduction/overview to strata titles and Homeowners' Associations and how they operate. 

Strata Titles

A strata scheme must be used where there is more than one condominium or apartment in the same building but can also be used for a villa development.

At the outset of a development, the developer will obtain planning permission to carry out the development and the subsequent subdivision of property into individual lots and common property.

Lots are the units (condos, apartments or villas etc.) or any other areas owned by owners which form part of the lot e.g., car spaces, garages, docks, storerooms etc. and each is shown on the title as being owned by a lot owner. 

Common property is defined as all areas of the development which are not contained in any current strata lot(s), such as common stairwells, driveways, visitor parking, roofs, paths, gardens, main gates, garbage areas, exterior walls and windows, balconies, lifts, etc, as well as recreational facilities such as gym, sauna, spa, swimming pool, tennis court, meeting room, golf course, etc. 

A registered surveyor draws up a Strata Plan of subdivision showing which parts of the scheme will be individually owned lots, with the remaining parts being common property. All lots are allocated a unit entitlement and the original schedule of unit entitlements is shown on the Strata Plan and on the title to the common property. The unit entitlement will determine the proportion of the common expenses which the unit is responsible for, as well as its proportion of the overall voting rights of the Strata Corporation. The larger a unit, the larger its assessments liability and its voting rights.


This plan is then submitted to the local planning authority for approval. When approved by the local authority the Strata Plan is registered at the Land Registry. Following successful registration, title registers are created for each lot and one for the common property.

Once a Strata Plan is registered, a strata scheme comes into existence and a statutory strata corporation is automatically formed by operation of law. This legal entity will then bear the name "The Proprietors Strata Plan No. [ ]”, such number being allocated by the Land Registry.

The common property is owned by the Strata Corporation which comprises all the lot owners as a collective and there will be an Executive Committee, which is the representative entity of the Strata Corporation.

All owners must contribute to the maintenance of these common areas and facilities through a system of assessments which are levied on owners, as determined via a budget of expected expenses. Regular assessments are a reference to the budgeted strata fee contribution, which is typically paid monthly. Special assessments may be levied for extra-ordinary items of expenditure.

The Strata Corporation will have a set of by-laws. There are a model set of by-laws set out in the Strata Titles Ordinance but usually a developer will submit and register its own set of by-laws tailored to the development which add to or amend the default set of by-laws.

The principal obligations of all lot owners typically include:

  • to pay rates and strata fees.
  • to notify the Strata Corporation of any change in ownership or occupancy.
  • to comply with the scheme's by-laws.
  • to behave in a manner which won't offend other residents or interfere with their peaceful enjoyment of the scheme.
  • to not carry out alterations to their lot without consent from the Strata Corporation and local authority (if required); and
  • obligations of lot owners in relation to renting their lot to third parties.

Often the day-to-day management of larger schemes will be contracted out to a professional management company.

Examples of developments which use the strata title system are South Bank, Coral Gardens and the Residences at the Ritz Carlton.

Homeowners' Association

This set-up is usually seen where there is a development or residential community comprising private villas or homes.

Each residence will have its own title number and, upon purchasing the property, the purchaser will be granted a share in the Homeowner's Association (“HOA”).

The developer will retain certain parts of a development for amenities and common areas e.g., roads, reception, restaurant, gym and then will grant easements to the HOA to use access and use those roads and facilities. Usually there will be provisions for the developer to transfer such amenities and common areas to the HOA, either after the final home within the development is sold or after a certain period.

Like strata assessments, the HOA will have an assessments budget and will charge for the upkeep of amenities and common areas.

Instead of having by-laws, there is usually a form of Restrictive Agreement which is registered on title and applies to all owners across the development. This will deal with various covenants in relation to the property and governs the payment of assessments levied on the property.

Examples of developments which have been set up with an HOA include Beach Enclave and the Leeward Residential Community.

Conclusion

Both strata properties and HOA properties have common amenities and areas for the use of owners and fees/assessments charged for the maintenance and upkeep of those areas. It comes down to personal preference as to whether a buyer wishes to purchase a property in a resort or a residential/private villa community, depending on the type of facilities and level of privacy they desire.

Real Estate at Griffiths and Partners

Our full-service real estate team acts for buyers, sellers, developers, and financiers, and are highly experienced in advising on the purchase, sale and development of property in the Turks and Caicos Islands.

We regularly advise on some of the largest and most complex property transactions in the islands, and our attorneys bring a high level of technical expertise and a local experience to each transaction.

We also handle a wide range of local residential transactions ranging from the purchase and sale of some of the most valuable and prestigious properties in the islands to acting for first time buyers.

There are no restrictions on foreign ownership of property in the Islands and we regularly provide advice to overseas clients through all the stages of acquiring property, and how best to structure the local ownership of property.

As trusted advisors to our developer clients, we provide guidance and close support throughout the development process, from site acquisition and planning, through the construction stage, to completion and thereafter the management and onward disposal or lettings of the property.

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.