Strata Levies 2026: Essential Guide for Australian Apartment Owners

Strata levies are recurring fees paid by all owners in a strata scheme. These funds are pooled to cover the costs of maintaining and operating the building’s common areas and shared facilities. Levies are typically set at the annual general meeting (AGM) of the owners’ corporation (also known as the body corporate in some states) and are usually paid quarterly.

Levies are divided into different funds, each with a specific purpose:

• Administrative fund: Covers day-to-day expenses such as cleaning, gardening, minor repairs, utilities for common areas, and strata management fees.
• Sinking fund (or capital works fund): Used for long-term repairs and upgrades, like repainting, roof replacement, or major equipment overhauls.
• Special levies: Raised when unexpected or significant expenses arise that aren’t covered by the regular funds, such as urgent repairs or compliance upgrades.

Many strata owners across Australia have seen their levies rise in 2026. Several factors are contributing to these increases:

Higher Insurance Premiums

The cost of building insurance has risen in recent years. Factors such as increased climate risks, stricter underwriting, and claims history can all impact premiums. As insurance is a major expense for strata schemes, higher premiums flow directly into higher levies.

Compliance and Building Maintenance

Recent reforms in states like New South Wales and Victoria have introduced stricter requirements for building compliance, fire safety, and defect rectification. These changes often require strata schemes to invest more in maintenance and reporting, especially for newer buildings or those with known defects.

Inflation and Rising Service Costs

General inflation has affected the cost of goods and services across Australia. Everything from cleaning contracts to lift servicing and gardening has become more expensive, putting additional pressure on strata budgets.

Increased Sinking Fund Contributions

Many strata committees are increasing contributions to the sinking (or capital works) fund. This is to ensure there are enough reserves for future repairs and to meet new compliance standards, reducing the risk of unexpected special levies.

Strata levies are essential for the ongoing upkeep and value of your property. Typical expenses funded by levies include:

• Cleaning and maintenance of common areas
• Gardening and landscaping
• Repairs to shared facilities (e.g., lifts, pools, gyms)
• Utilities for common areas (lighting, water)
• Building insurance
• Strata management fees
• Long-term capital works (e.g., repainting, roof repairs)
• Compliance and safety upgrades

Special levies may be raised for:

• Major repairs not anticipated in the annual budget
• Urgent compliance works
• Addressing building defects

Levies are determined by the owners’ corporation or body corporate at the AGM. The committee reviews the building’s expenses, maintenance plans, and future needs, then sets the budget for the coming year. Levies are usually allocated based on each lot’s unit entitlement, which reflects the size or value of each apartment or townhouse.

Owners receive notice of the proposed levies before the AGM and can ask questions or raise concerns at the meeting. It’s important to review the financial statements and capital works plan to understand how funds are being managed.

With levies on the rise, proactive management can help owners keep costs in check and avoid surprises.

1. Review Budgets and Financial Statements

Attend AGMs and review the building’s financial documents. Look for areas where costs could be reduced, such as renegotiating service contracts or identifying unnecessary expenses.

2. Get Involved in Decision-Making

Consider joining the strata committee or attending meetings regularly. Having a say in how funds are spent can help ensure money is used efficiently and priorities are clear.

3. Support Preventive Maintenance

Regular maintenance can prevent costly repairs and insurance claims in the future. Encourage the committee to invest in ongoing upkeep rather than deferring works, which can lead to larger expenses down the track.

4. Assess Insurance Arrangements

Work with insurance brokers to ensure the building’s insurance is comprehensive but competitively priced. Some schemes may opt for higher excesses to reduce premiums, but it’s important to balance cost with adequate coverage.

5. Budget for Future Increases

When buying into a strata property, factor in the likelihood of annual levy increases. Ask for recent levy notices and the capital works plan to get a sense of upcoming expenses. This can help you assess affordability and avoid budget shocks.

Several state governments have introduced or proposed changes that may impact strata budgets:

• New South Wales: New rules require more detailed reporting of building defects, higher minimum sinking fund contributions, and increased transparency for strata managers.
• Victoria: Ongoing reforms are tightening requirements for building maintenance schedules and safety compliance, which can increase administrative costs.
• Queensland: A review of body corporate legislation is underway, with potential changes to disclosure requirements and how levies are set.

Owners should stay informed about local policy changes, as compliance costs are likely to continue rising.

Rising strata levies can affect both the affordability of owning an apartment and the property’s resale value. Higher levies may impact rental yields for investors and can be a consideration for buyers comparing properties. It’s important to weigh the benefits of well-maintained common areas and strong financial management against the ongoing cost of levies.

What happens if I don’t pay my strata levies?

Unpaid levies can attract interest and recovery costs. The owners’ corporation may take legal action to recover overdue amounts, and persistent non-payment can result in further penalties.

Can strata levies be reduced?

Levies are set based on the building’s expenses and future needs. While some costs can be reviewed or negotiated, essential expenses like insurance and compliance are difficult to reduce. Active participation in the committee can help identify savings.

Are special levies common?

Special levies are raised when unexpected or significant expenses arise. While not routine, they can occur if major repairs or urgent works are needed and there aren’t enough funds in the regular budget.

How can I find out about upcoming levy increases?

Review the building’s capital works plan and recent AGM minutes. These documents outline planned works and forecasted expenses, giving you an idea of potential future levy increases.

Strata levies are a necessary part of owning an apartment or townhouse in Australia. In 2026, rising costs are being driven by insurance, compliance, and general inflation. By staying informed, participating in decision-making, and planning ahead, owners can manage these expenses and help maintain the value of their property.