If you’re buying an apartment, unit or townhouse
in Victoria, you’ll almost certainly encounter
an owners corporation — and understanding how
it works could save you thousands of dollars
and years of frustration.
Here’s everything you need to know, in plain
English.
What Is an Owners Corporation?
An owners corporation (previously called a body
corporate) is a legal entity that automatically
forms when land is subdivided and common property
is created. If you buy into a building with shared
areas — a lobby, lifts, garden, car park, or pool
— you automatically become a member of its owners
corporation whether you like it or not.
The owners corporation is governed by the Owners
Corporations Act 2006 (Vic) and administered by
Consumer Affairs Victoria.
What Does an Owners Corporation Do?
The owners corporation is responsible for:
- Managing and maintaining common property
- Taking out building insurance
- Collecting fees from lot owners
- Enforcing the rules of the building
- Resolving disputes between owners
- Keeping financial records and holding
annual general meetings (AGMs)
Who Runs It?
Most owners corporations appoint a professional
manager — a licensed strata management company
registered with Consumer Affairs Victoria. The
manager handles day-to-day administration on
behalf of the owners.
An elected committee of lot owners oversees
the manager and makes decisions on behalf of
the whole owners corporation.
What Are OC Fees?
When you own a lot in an owners corporation,
you pay regular fees — usually quarterly —
to cover the cost of running and maintaining
the building. These fees cover:
- Building insurance
- Common area maintenance (cleaning,
landscaping, lift servicing) - Management fees
- Contributions to the maintenance fund
for future major works
Fees vary enormously depending on building
size, age, and amenities. A simple two-storey
walk-up might charge $400 per quarter. A
luxury high-rise with a pool and concierge
might charge $3,000 or more.
What Is the Maintenance Fund?
The maintenance fund (sometimes called the
sinking fund) is money set aside for major
future repairs — think roof replacement,
lift upgrades, or structural works.
Tier 1 and Tier 2 owners corporations in
Victoria (those with more than 100 lots or
annual fees exceeding $200,000) are legally
required to maintain a maintenance plan and
fund. A healthy maintenance fund means fewer
surprise special levies for owners.
What Are the Different Tiers?
Victoria classifies owners corporations into
five tiers based on size:
- Tier 1: More than 100 lots or annual fees
over $200,000 — most regulated - Tier 2: 10–100 lots or fees $20,000–$200,000
- Tier 3: 3–10 lots or fees $10,000–$20,000
- Tier 4: 2 lots or fees under $10,000
- Tier 5: Services only (no common property)
The tier affects what financial reporting,
insurance, and governance requirements apply.
What Are the Rules?
Every owners corporation has rules governing
how owners and tenants must behave. These
cover things like:
- Noise levels and quiet hours
- Pet ownership
- Use of common areas
- Parking
- Renovation approvals
- Short-stay accommodation (like Airbnb)
If the owners corporation hasn’t created its
own registered rules, the Model Rules under
the Owners Corporations Regulations 2018
apply automatically.
What Is a Special Levy?
A special levy is a one-off fee charged to
all lot owners when the owners corporation
needs to raise money for something not
covered by the regular budget — an emergency
repair, legal costs, or a major capital works
project.
Special levies can run from a few hundred
dollars to tens of thousands depending on
the work required. Before buying, always
check whether any special levies have been
raised recently or are currently proposed.
How Are Disputes Resolved?
Disputes between lot owners, or between an
owner and the owners corporation, are handled
by the Victorian Civil and Administrative
Tribunal (VCAT). Before going to VCAT, parties
are encouraged to use the owners corporation’s
internal dispute resolution process.
Consumer Affairs Victoria also provides
guidance and can assist with certain disputes.
What Should I Check Before Buying?
Before purchasing any property affected by
an owners corporation, always review:
- The OC certificate (discloses fees,
disputes, and key information) - Recent AGM and committee meeting minutes
- Financial statements for the past 2-3 years
- The maintenance fund balance and plan
- Building insurance certificate
- Any registered rules
We recommend engaging a licensed Victorian
conveyancer to review these documents as
part of your due diligence.
Next Steps
Understanding the owners corporation is just
one part of buying smart in Victoria. Before
you sign anything, speak to a licensed
conveyancer, get an independent building
inspection, and make sure your finance is
pre-approved.
Disclaimer: This article is for general
informational purposes only and does not
constitute legal, financial or property advice.
Always engage qualified professionals before
making any property purchase decision.
Vic Property Guide 
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