Serviced Strata Schemes: Real Property or A Financial Product?
- Pacific Rim Real Estate Society
- Publication Type:
- Conference Proceeding
- Serviced Strata Schemes: Real Property or A Financial Product?, 2009, pp. 1 - 15
- Issue Date:
Over the last two decades, serviced strata schemes have become a popular investment vehicle for many people aspiring to enter the real estate market. On one level, serviced strata schemes are based on ownership of strata title and are regulated according to state and territory strata title and conveyancing laws. Yet, serviced strata schemes are also a way of pooling resources and are additionally regulated as managed investment schemes under the Corporations Act 2001 (Cth). These dual layers of regulation are primarily, although not exclusively based on disclosure mechanisms. The purpose of this paper is to examine those mechanisms to determine the compatibility of state/territory laws to commonwealth objectives and also to determine the extent to which the present regime meets the needs of investors. It is concluded that lack of uniformity amongst state and territory laws is at odds with the unified approach fostered by the Corporations Act 2001 (Cth). This discrepancy potentially undermines the protection of investors. We therefore argue that the way forward should encompass Australia-wide codes applying to disclosure regimes with respect to the acquisition of an interest in strata title.
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