Are you considering purchasing an investment property or upgrading your current living situation? Buying a newly built home can be exciting. The promise of modern design, energy efficiency, new amenities, and minimal maintenance appeals to many Australians seeking apartment or townhouse living. However, buying off-the-plan, before construction is complete, or a newly built strata, owner’s corporation, or body corporate property comes with unique risks. These risks and due diligence requirements differ from purchasing an established building.
Once you buy into a strata, owners corporation, or body corporate scheme, you share ownership and responsibility for the common property, such as roofs, walls, lifts, plumbing, and gardens. If the building has hidden defects, inadequate waterproofing, or underfunded maintenance budgets, you’ll share in the cost of repairs, even if you’ve only recently moved in. Early due diligence helps to:
In a strata, owners’ corporation, or body corporate property, ownership is divided between individual lots and common property. Before purchasing into a scheme, it’s important to better understand of these areas by reviewing the registered strata plan, survey plan, or plan of subdivision and registered by-laws or building rules. These legal document outlines the boundaries of your lot, the layout of the building, and the common property areas.
Each lot is assigned a unit entitlement. This determines your share of strata levies and your voting power in the owners corporation. A higher entitlement means greater financial contribution and more influence in decision-making. Always check the registered strata plan, survey plan, or plan of subdivision to understand your ownership rights and how it compares to other lots.
By‑laws and building rules shape daily life, covering pets, noise, renovations, parking, and the use of shared spaces. It’s vital they align with your lifestyle. Before purchasing a property, it is essential to read all by‑laws or building rules to check for rentals, modifications, or property sales restrictions. You may request a copy from the agent or seller, or you can find this in the contract or disclosure documents.
A developer’s track record and credentials can often predict the integrity of the project. That’s why it is important to research the developer’s name and builder’s licence and review their past projects for complaints, litigation, or defect history. You can also check if the builder has been subject to disciplinary action or liquidation through the ASIC’s company register.
Off-the-plan contracts can be lengthy and complex, often favouring developers. It is always best practice to engage a solicitor or conveyancer with industry knowledge to help you interpret technical clauses and identify red flags.
New developments typically come with statutory warranties or defects liability periods as per your state laws and typically covers building issues such as waterproofing, and structural issues for a defined time after completion or occupancy. For newly built properties, it is best practice to confirm that defect insurance certificates are current and valid and if there are any claims that have been made.
When buying off-the-plan and before completion, it is important to ask what work remains, what finishes are included, what changes may be made during construction, and whether there are guarantees about finishes.
Just because a building is new does not mean it is defect-free. Even though a property might be visually appealing, it may conceal poor materials or cost-cutting in key areas, which can cause complex issues later. Before buying a new building, investigate how it has been designed, built, and certified.
Defects are common even in brand-new buildings, especially in multi-level complexes. You or your legal representative should arrange an independent defects inspection before final settlement and request a building handover report that lists outstanding items.
Before settlement, it is best practice to check that the building meets all legal compliance requirements. The owners’ corporation or body corporate cannot properly function for schemes without these certifications. Furthermore, missing or delayed certificates can signal incomplete work or unresolved compliance issues.
Many new properties underestimate long-term maintenance needs. Owners may face unexpected special levies to fund major repairs or upgrades without proper planning. A well-prepared capital works plan helps ensure the building remains safe, functional, and financially sustainable.
One of the most critical areas for buyers is understanding the financial obligations, what’s happening behind the scenes, and whether the scheme is prepared for future costs. The developer usually prepares the first-year strata budget and may not reflect realistic long-term costs. Many buyers are surprised when levies increase sharply after the first Annual General Meeting (AGM).
If levies seem ‘too low to be true,’ they probably are. An underfunded building may eventually issue special levies to cover major works.
Buying a new property is a significant investment, and it’s not just the purchase price you need to consider. Additional costs may cause surprise and add up quickly. To stay prepared, it helps to understand the upfront and ongoing expenses associated with strata, owners’ corporation, or body corporate ownership.
One of the most crucial points to consider when buying off-the-plan is the proposed fees. These cover the cost of electricity, insurance, maintenance and repairs. Aside from factoring this ongoing expense into your budget, comparing the fees to similar properties is worthwhile.
Investors and owner-occupiers should buy a property that suits their budgetary requirements. For example, if they have a small disposable income, they may decide to target properties with higher rental yields, as this may help cover the mortgage repayments. People on larger, disposable incomes don’t necessarily need to target properties with higher rental yields.
Don’t forget the costs to maintain your own apartment. Investors and owner occupiers should have funds set aside for annual maintenance costs, whether for a yearly gutter clean before winter, to repair or replace an ageing fence, or for a fresh coat of paint.
The cost of utilising a property manager varies for each management company. However, they shouldn’t be chosen purely on price. A cheaper property manager may not provide a proactive service to optimise your assets.
Apartments and townhouses usually require investors and owner-occupiers to pay fees for managing the common property. Strata managers and body corporate managers are experts in their field and act as a relationship manager between all owners and the common property. These levies are used to maintain areas within the complex, such as lifts, pools, and gardens, so the more features there are, the higher the fees may typically be. Investors should consider these additional costs when planning their next purchase.
A professional strata manager plays a key role in ensuring the smooth operation of a strata scheme. In newly built developments, they help transition from developer control to owner management, establish financial systems, and guide compliance with legal obligations.
They help prepare realistic financial plans, including administrative and capital works funds, and advise on levy contributions.
Strata managers can help organise routine maintenance, emergency repairs, and contractor engagement for common property.
They keep the scheme compliant with industry and state laws, including record-keeping, insurance, and meeting requirements.
Managers can help arrange AGM’s, distribute notices, and act as a point of contact between owners and the committee.
They help interpret and enforce by-laws or building rules, and guide owners on proposing changes or resolving disputes.
Coordinate defect inspections, liaise with builders or developers, and see that issues are addressed within warranty periods.
Before renewing your agreement, take a moment to compare your options. Our quick and easy form can be completed in less than 30 seconds.
When buying into a strata, owners corporation, or body corporate property, you don’t just buy a home; you join a financial and social community. Everything from financial health, maintenance, and insurance, to the ethos of your neighbours affects your lifestyle and asset value. Being informed from the start lowers risk and secures your investment.
New buildings can offer modern living with low maintenance, but only if you do your homework. It is important to always check legal documents, inspect maintenance planning, validate financial reserves, and understand management structures. Know the risks, especially for off-the-plan purchases. When in doubt, rely on professionals to guide you through making a smart, sustainable investment.
This article is edited by Lauren Shaw Regional General Manager and Licensee-in-Charge on October 2025.
