327. Peter blows the whistle on overcharging strata managers
Podcast: Play in new window | Download
Subscribe: RSS
Strata manager Peter Wilson regularly inherits the management of small buildings from large management companies. In this chat, he reveals how these buildings are often being charged for services they don’t need, including the lodgement of tax returns and BAS when they have no taxable income and aren’t registered for GST. He calls for more honesty, transparency and competition in the sector, so that owners can receive the personalised service they deserve.
Links mentioned:
- Get the transcript here!
- Unique Strata website
- Peter Wilson’s email address: peter@uniquestrata.com.au
Thank you Amanda/Peter. This was indeed very interesting and I have contacted Peter.
I am actually preparing a complaint to SCA, which seems extremely complex, but I don’t mind. Our current strata manager or respectively their staff is not very competent and knowledgeable.
Hi – an excellent podcast. I agree with the comments made by Peter. I believe there needs to be an enquiry in SM.
Have severe doubts about this podcast. Its an ad for this guy. “Everyone else is shyte, I’m great.” I see it’s on his website so fair enough, but its a bit hysterical.
There are buyer beware points made but things like having an extra meeting should be an extra fee.
Owners should look at the agency agreement and ask about the fees scheduled at the back. If it’s in the schedule it’s legal to charge.
PICA is buying alot of strata agencies and yes that is reducing competition.
There is no chain of work with everyone taking a cut.
The strata industry has a high attrition rate and staff are difficult to get. Staff are therefore expensive. It’s very difficult dealing with whinging owners and everything is urgent.
FYI I’m not a strata manager or licensee.
Peter is like a breath of fresh air!
Whilst most Strata management firms charge a base fee for management and then have the additional fees that they apply however isn’t this because that all buildings are not the same. One may have to submit an AFSS that we all know is hours of planning/correspondence/arranging repairs etc then why shouldn’t those buildings be charged for these extras. Not all strata management companies are out there ripping off owners corporations which Peter seemed to place us all in the same basket .. In most other professional service industries they charge for these so called extras, why is it wrong if a strata management company does it. I and a lot of other strata mangers in the industry work hard and long hours. We cop unnecessary abuse. Our knowledge is called on everyday. We are constantly having to update that knowledge with changes to legislation, the introduction of D&BPA and the Strata Hub etc however if we charge for these extra services we are rip offs. Sorry Peter but you hit a very sensitive nerve with me.
Hi Donna, thank you for this response. I am always happy to offer a right of reply. Drop me an email if you’re willing to share your views on air.
Hi Amanda happy to chat at anytime. Was prepared to join today (Friday 2/9), however was held to ransom by that dreaded Friday afternoon emergency call. I have listened to the recording via FB just now
I don’t understand why you would complain. Surely you knew what you were getting into? Strata Managers are there to manage and resolve issues.
Thank you for a great podcast.
I will contact peter regarding a quote.
A lot of Strata businesses do not want to represent you at NCAT.
On another note NSW Fair trading is setting up a Strata Hub, what is this all about?
Cheers Stan
Hi Stan,
You can learn more about Strata Hub by listening to Episode 314 here: https://yourstrataproperty.com.au/314-are-you-ready-mandatory-annual-reporting-starts-soon/.
Please don’t hesitate to reach out if you have any questions or concerns. 🙂
Regards,
Richelle
Hi Stan
why would any strata manager represent an owners corporation at NCAT? Depending on the issue, If the other side is represented by a lawyer, then we are usually eaten alive. The preparation, ensuring all documents are included, complying these documents for submission to NCAT as required by them to be submitted, obtaining statutory declarations backing the owners corporation etc etc etc all these take time. With past experiences owners corporation expect strata managers to do this as part of managing the complex This is not the case. They are not lawyers (as some may think) and if the owners corporation wants a favourable result, then this is best left to those that have the experience – Lawyers. However if committee members/owners corporation took the time to talk over (mediate) the issue at hand with owners / occupiers, there would be a lot less cases pending at NCAT
The problem is in part that the Act says one thing but reality is another
3 Objects of Act
The objects of this Act are:
(a) to establish an independent Civil and Administrative Tribunal of New South Wales to provide a single point of access for most tribunal services in the State, and
(b) to enable the Tribunal:
(i) to make decisions as the primary decision-maker in relation to certain matters, and
(ii) to review decisions made by certain persons and bodies, and
(iii) to determine appeals against decisions made by certain persons and bodies, and
(iv) to exercise such other functions as are conferred or imposed on it, and
(c) to ensure that the Tribunal is accessible and responsive to the needs of all of its users, and
(d) to enable the Tribunal to resolve the real issues in proceedings justly, quickly, cheaply and with as little formality as possible, and
(e) to ensure that the decisions of the Tribunal are timely, fair, consistent and of a high quality, and
(f) to ensure that the Tribunal is accountable and has processes that are open and transparent, and
(g) to promote public confidence in tribunal decision-making in the State and in the conduct of tribunal members.
Timely, fair, consistent, of a high quality LOL!
Accountable; what a hot steaming load that is.
Justly, quickly, cheaply and with as little formality as possible. Oh please stop it, laughing so hard could injure me.
I have been involved in NCAT (and CTTT) matters for almost 15 years and it has become worse with time and it was never good in the first place.
The Objects of the Act (CAT Act) are in many ways just window dressing.
Hi Anonymus
Most strata owners have no idea about strata. We are on the third SM, and all did as you say shyte things. Charging for what they never performed, charged individual small disbursements, which should be included in a bundle. Crediting some of those per journal, but funds never came back, neither in cash nor in credit against new expenses. Overcharged large amount, same credit per journal no funds returned. Put a charge for overdue levies against OC credit which is solely related to the unit owner in debt.
Resume, innocent OC would probably not even check their statements or don’t have access to them without asking for it.
I am not whinging and nothing is urgent,but if 5 staff could take action to rectify, because they have no accounting experience.
It is now the eighth month without resolving those mistakes. I still call them mistakes, in my mind I see it differently, but cannot proof.
The owner is more absent from the office than training and supervising their staff.
Please don’t judge.
As far as I am concerned, Peter is not advertising his business, because he only takes on clients he can manage himself.
I have no regards for NCAT and would recommend anybody to stay away from them, unless they have time and money to spare
“Hi – an excellent podcast. I agree with the comments made by Peter. I believe there needs to be an enquiry in SM.”
We are wasting a great amount of money getting nowhere in our Strata Schemes. Please read the “Strata Hub” and you find out that it’s another waste of money. For Example, the person who provides the information is not liable but the owners corporation.
The person should provides the information to their local council. We know that the local council already has the information so why them and not the ambulance service, fire brigade and the police?
Also some Strata Managers provide good service and teach us our rights and obligations. Example, a lot owner had a leak in her bathroom, and the tiles had to be changed we thought that the owner was the person who was liable. The Strata Manager informed us that because the tiles were the original ones we were liable to their replacement
Interesting to hear the comments about taking an insurance commission. We had a situation where the strata manager said they weren’t taking a commission – which they weren’t in the strata’s books but were through the BMC. I think transparency is often the key and if the answer to the question at the AGM had been transparent there would have been a better feeling about it.
Hi Bruce, our SM claims not receiving commission, but charged instead $150 per unit to compensate. This is in the contract, but hidden in a narration, not in the column where fees are listed.
We have been apartment owners, been on and chaired OC’s as well as dealing with a number of SM’s (including the majors). The podcast is not a shock as in our experience the strata industry is rife with corruption and incompetence. Many strata managers are only looking to take the easy way out and minimise the work that needs to be done. In some cases they are downright arrogant and have no concept of customer service. To make life easy for themselves that will seek out compliant OC members and get them on side. The industry needs a total shake up.
A problem which could be remedied is that strata managing agents deduct payment for additional services from the owners corporation’s bank account each month but do not furnish an invoice to the strata committee. Owners only see a total amount for the year in the accounts presented for the AGM.
Neither the strata committee nor owners know who has been charging time, what work was done, how much time was charged for the various tasks etc. No one can see what the strata managing agent is achieving for the owners, or conversely if the additional charges are fair and reasonable.
Lawyers and accountants render detailed invoices which clients are able to discuss if they have questions regarding the work said to have been done or amounts charged.
It is not enough for strata managing agents to quote an invoice number in a monthly finance report, that invoice should actually be provided to the strata committee.
Hi Jillian
Our SM does the same. I made it a habit to look every day at their paid invoice activity report. Payments without invoices provided. Overcharged, or services charged not carried out
Jillian, I agree. I see some managers issuing monthly invoices but not many. The fact that the agent manages the owners’ funds via a trust account should mean a commitment to greater transparency.
We ended up moving to self-management after too many frustrating SM experiences, including good SMs moving on, then being obliged to ‘train’ a new one. Or, in the final situation, having a good one replaced by one who – literally – did nothing for us: no levies issued, no bills paid. The big alarm was when our long-time excellent cleaners emailed me (as chair) to ask why we’d sacked them, copying an email from our SM saying ‘the strata committee has terminated your services’. He’d put a mate in. This coincided with Energy Australia informing us they were disconnecting the building for non-payment.
His bosses (this is a big firm) really didn’t solve these problems. They made nice noises, but wouldn’t credit the months of fees charged for no services rendered. So we moved on.
IF I were to go with a strata management firm again, I would insist on all expenditures, apart from regular charges like cleaning/energy etc, being approved by one or more members of the committee. And with a bank account that required two signatures by strata committee members. So the SM can initiate payments but cannot approve them.
I would also be very specific about the circumstances in which a strata manager can exercise any delegated authority and would probably limit it to matters explicitly approved by the strata committee, with the exception of an emergency work order where it’s impossible to contact a committee member.
As someone who’s provided professional services for most of my career, this has always been the standard I operate to, and I would never take any action, nor spend a dollar of my clients’ money, without their absolutely explicit approval.
Too many owners think ‘the strata’ are somehow the boss of the building, instead of a service provider to the building’s owner – their owners corporation. And there are plenty of SMs who foster this misconception. Some, I think, actually share it.
Hi David, maybe we should get journalists from Four Corners to screen a story on strata managers and publish to make owners corporations aware of their rights.
I arranged a EGM myself by electronic voting to vote the SM out and engage Peter Wilson in the future. Our contract goes for another month and the SM would not let go earlier. All queries and discrepancies have not been resolved in regards to charges in question. Today, I made the arrangement to freeze the OC bank account, until my queries have been resolved and then taken over by our new SM.