FAQ CATEGORY 30/06/22
How is unit entitlement calculated?
Unit entitlement is a number that shows an owners share of ownership in common property and how much they’ll pay to maintain it. It also affects voting power in decisions the owners corporation makes.
When a developer registers a strata plan, each lot is given a unit entitlement. Many people believe that unit entitlement is based on the size of the lot, but it’s not necessarily the case.
In November 2016 legislation changed and a valuers certificate is now required to be submitted with the plan showing how the unit entitlement was calculated.
If a strata plan was registered before November 2016 a valuation may not have been obtained the the calculation of the entitlements may not be known.
As an example, if there are two lots in a strata scheme, each worth $500,000, then the unit entitlement for each lot would be 50 out of 100. If one was worth $600,000 and the other $400,000 then the unit entitlements would be 60 for one and 40 the other.
If an owner or the owners corporation believes the unit entitlements are unfair they can apply to NSW Civil and Administrative Tribunal (NCAT) to make an order to reallocate the unit entitlements of the scheme.
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