Strata Inspection Report — What to Look For When Buying a Unit (Australia 2026)
A strata inspection report (also called a strata records search or owners corporation search) gives you access to the financial and governance records of the strata scheme before you buy. It is one of the most important checks for apartment and townhouse buyers.
What Is a Strata Inspection Report?
In a strata-titled property, the common areas (lobby, lifts, external walls, roof, garden, pool) are owned collectively by all lot owners and managed by the owners corporation (NSW) or body corporate (QLD, VIC). Each owner pays levies to fund the common area management.
A strata inspection report is a review of the scheme’s records — typically by a professional strata inspector — covering:
- Financial position (levy levels, fund balances, outstanding debts)
- Meeting minutes (decisions, disputes, planned works)
- Maintenance and repair history
- Building defects
- Insurance
- By-laws
Key Documents Reviewed
| Document | What it reveals |
|---|---|
| Administrative fund budget | Annual income and expenses; whether levies cover actual costs |
| Capital works (sinking) fund balance and plan | Whether funds exist to cover major future works |
| Meeting minutes (2–5 years) | Disputes, complaints, planned works, outstanding issues |
| Correspondence file | Communications between owners, strata manager, and builder |
| Strata roll | List of lot owners and contact details |
| By-laws | Rules around pets, renovations, Airbnb, parking |
| Insurance certificate | Whether the building is insured, and for what |
| Building defects register | Outstanding defects (especially critical in new buildings) |
| Litigation | Whether the scheme is in any legal dispute |
The Sinking Fund (Capital Works Fund)
The capital works fund (formerly called sinking fund) accumulates money for major future expenses — roof replacement, lift overhaul, painting, balcony repairs, pool resurfacing. State legislation requires strata schemes to prepare and follow a capital works fund plan.
Red flags in the sinking fund:
- Very low balance relative to the age and size of the building
- Fund plan that significantly underestimates future costs
- Recent or planned large expenditure not reflected in levy levels
- Major deferred maintenance (building that needs work but no funds to do it)
Example: A 20-year-old building with 50 lots, and a capital works fund balance of $15,000, with a roof replacement estimated at $180,000 in 3 years — has a serious shortfall. Owners will almost certainly face a special levy to fund the gap.
Special Levies — The Biggest Financial Risk
A special levy is an additional levy (outside the normal quarterly levies) raised by the owners corporation to fund unexpected or unfunded capital works. They can range from a few hundred dollars to tens of thousands per lot.
Examples that can trigger special levies:
- Fire safety remediation (particularly cladding replacement — significant cost for affected buildings)
- Structural defect repairs not covered by insurance or builder warranty
- Legal costs from litigation
- Major infrastructure replacement (lifts, pool, common area)
Before buying: Check the minutes for any mention of proposed special levies. If a major capital expense is on the horizon, ask your solicitor or strata inspector whether a special levy is likely.
Meeting Minutes — What to Look For
Meeting minutes from the last 2–5 years reveal the “health” of a strata scheme. Look for:
✅ Positive signs:
- Regular maintenance being performed
- Active and engaged strata committee
- Healthy financial reserves
- Clean building defect register
⚠️ Warning signs:
- Repeated complaints about the same issue (plumbing leaks, structural cracks, noise)
- Disputes between owners or with the building manager
- Deferred maintenance decisions (work noted but not actioned)
- Builder warranty disputes in new buildings
- Discussions about special levies or financial shortfalls
By-Laws — Know the Rules Before You Buy
By-laws govern what owners and residents can and cannot do. Common by-law restrictions:
| Topic | Common by-law content |
|---|---|
| Pets | May ban pets entirely or require committee approval |
| Renovations | May require owner corporation approval for any changes to the lot |
| Short-term letting (Airbnb) | Many strata schemes restrict or ban short-term letting |
| Parking | Lot-specific parking spaces; visitor parking rules |
| Noise | Quiet hours |
| Balcony gardens | May restrict certain plants |
If you are planning to keep a pet, renovate, or use the property as a short-term rental — check the by-laws before you buy.
Strata Inspection Cost and How to Order
A strata inspection is typically conducted by:
- A professional strata inspector ($300–$600)
- Your solicitor or conveyancer (some include a basic strata records review in their fee)
In NSW, you can access strata records yourself (the lot owner or their authorised representative can inspect records) — but a professional report is faster and provides expert commentary.
Frequently Asked Questions
Is a strata inspection report the same as a building inspection?
No — a building inspection assesses the physical condition of your lot and common areas. A strata inspection report reviews the financial and governance records of the owners corporation. Both are recommended for apartment purchases.
The levies seem low — is that a good sign?
Not necessarily. Very low levies may mean the capital works fund is being underfunded — the scheme is not saving adequately for future major works. Compare the levy level to the building’s age, size, and expected maintenance requirements.
The strata scheme has ongoing litigation. Should I be worried?
It depends on the nature of the litigation. Builder defect litigation in newer buildings can result in a positive outcome (remediation at builder’s cost). Disputes between owners or claims against the scheme can be costly and time-consuming. Review the nature and stage of any litigation with your solicitor.
Related Due Diligence Guides
- Property Due Diligence Checklist Australia
- Easements and Covenants — What Property Buyers Need to Know
- What Is a Caveat on Property?
- Property Due Diligence Hub
This article provides general information about strata inspection reports in Australia. Strata legislation and requirements vary by state. Always engage a licensed conveyancer or solicitor before buying a strata-titled property. Find one through MoneySmart.