Coming into effect on October 27, 2025 are the key changes to stage 2 of the new strata laws. These reforms, designed to further improve transparency, accountability, and fairness, will impact all strata schemes across New South Wales.

Stronger Powers for Fair Trading to Enforce Repairs

NSW Fair Trading is gaining new investigative and enforcement powers to ensure owners corporations meet their legal duty to maintain and repair common property.

• Expanded Powers: Fair Trading can now investigate potential breaches, demand documents, and issue compliance notices that require specific actions like fixing damage or using licensed professionals.
• Enforcement Actions: If a breach is found, Fair Trading has a range of options, including seeking a formal, voluntary written commitment (enforceable undertaking), issuing a monetary fine (penalty infringement notice), or applying to the NSW Civil and Administrative Tribunal (NCAT) for an order, which could even lead to the compulsory appointment of a strata managing agent.
• What you need to do: Strata committees, owners, and strata managers should proactively address any outstanding repair and maintenance issues. The NSW Strata building health check is a good tool to assist with this process.

Supporting Owners in Financial Hardship

New rules are being implemented to assist owners who are struggling to pay their levies.

• Financial Hardship Statement: All levy notices sent from October 27, 2025 must include a Financial Hardship Information Statement, which provides contact details for the National Debt Helpline.
• Standardised Payment Plans: Owners can now use a new standard form to request a payment plan for overdue contributions.
• Rules for Refusals: Owners corporations and strata committees are now required to consider all payment plan requests. They cannot have a blanket policy to refuse all plans and must provide a written response within 28 days. A request can only be reasonably refused if agreeing to it would leave the owners corporation with insufficient funds to meet its financial obligations.
• Protected Payments: Repayments made under a payment plan must be applied first to overdue levies, then to interest, and finally to any recovery costs. This ensures owners are not disadvantaged by unfair allocation practices.

 New Duties and Clarified Roles for Building Managers

The reforms clarify the role of building managers and introduce new legal duties to increase transparency and accountability.

• Who is a Building Manager? The new laws provide a clearer definition of who is and isn’t a building manager, excluding other service providers like cleaners or gardeners who are only engaged for specific repair or maintenance services.
• New Statutory Duties: Appointed building managers must now act honestly and in the owners corporation’s best interest. They must promptly bring any maintenance or safety issues to the owners corporation’s attention and propose solutions.
• Disclosure of Benefits and Interests: Building managers are required to provide written notice of any benefits they will receive in relation to a contract they suggest, as well as disclose any financial interests or relationships with suppliers or the original owner of the scheme.
• Tribunal Powers: The NSW Civil and Administrative Tribunal (NCAT) now has an additional ground to terminate a building manager’s agreement if they are found to have acted unlawfully in their role, providing a clear path to address mismanagement or misconduct.

These changes represent a significant step towards modernising strata law in NSW, providing greater protection for owners and promoting a more professional, fair, and transparent strata environment. We encourage all owners, committee members, and strata managers to familiarise themselves with these new regulations to ensure their scheme remains compliant.

Your Summary of the New Laws

 For more information we share a summary of the new laws commencing 27.10.25 – Changes to Strata Laws

Your Next Steps

The new strata laws introduce significant changes that can affect your scheme’s legal and financial health. Navigating these reforms requires expert knowledge to ensure compliance and avoid potential disputes or penalties.

• For Strata Managers and Owners Corporations: We can help you update your procedures to comply with the new requirements for repairs, financial hardship, and manager agreements. Our specialist strata team can also advise you on how to handle the new powers of NSW Fair Trading.
• For Lot Owners: If you are facing financial hardship or believe your owners corporation is failing its duty to repair common property, we can provide clear advice on your rights and guide you through the new formal processes, including payment plans and dispute resolution.

For more information visit NSW Fair Trading website.

Avoid Unenforceable By-laws from October 27!

A comprehensive by-law review is not a formality—it is a mandatory risk mitigation exercise. Any existing by-law that conflicts with the new legislation becomes instantly invalid and legally unenforceable the moment the new law commences.

To discuss how these reforms impact your scheme and ensure a smooth transition, our specialist strata legal team would be happy to assist. Contact us to ensure you’re compliant and fully prepared for the 27 October 2025 phase 2 changes.