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What is an Owners Corporation in Victoria?

Written by Staff on August 12, 2026.

If you’re buying an apartment, unit or townhouse anywhere in Melbourne, you’ve probably seen the term “owners corporation” somewhere in the contract of sale. An owners corporation in Victoria is the legal entity that manages the shared parts of a subdivided property (such as driveways, gardens, lifts, and foyers) on behalf of everyone who owns a lot. If your future home sits on land with common property, you’ll automatically become a member, whether you’ve thought about it or not.

For first home buyers, this often comes as a surprise. You’re focused on the purchase price, the mortgage, and the inspection report when a stack of owners’ corporation documents lands in your Section 32. Understanding what you’re signing up for now saves a lot of confusion (and money) later.

Quick Answer

Here’s what buyers should know about owners’ corporations in Victoria before they sign anything:

An owners corporation (formerly known as a body corporate) manages the common property of a subdivided residential, commercial or mixed-use development.
If you buy a lot that’s affected by common property, you automatically become a member.
Victorian owners corporations are classified into one of five tiers, based on the number of occupiable lots, and each tier carries different obligations.
Owners’ corporation fees fund day-to-day administration, insurance, and maintenance, plus special levies for major repairs.
Before you buy, always check the owners corporation certificate attached to the Section 32 for fees, insurance, disputes and upcoming works.

What Is an Owners Corporation?

An owners corporation is the body that manages common property in a subdivided development. It replaced the old term “body corporate” on 31 December 2007, when the Owners Corporations Act 2006 (Vic) came into force. The name changed, but the job didn’t. Your owners’ corporation is still responsible for maintaining, insuring, and properly governing shared areas.

An owners corporation is created automatically the moment a plan of subdivision containing common property is registered with Land Use Victoria. There’s no separate application to join and no opt-out. If your lot is shown on a plan alongside common property, an owners corporation exists for that development, and you’re part of it from settlement.

Common property is whatever the plan of subdivision says it is. This usually covers gardens, stairwells, driveways, lifts, foyers, fences and shared pipework. The Owners Corporations Act 2006 requires the owners corporation to manage, administer, repair and maintain all of it on behalf of the lot owners. The obligation attaches to the entity itself, not to whichever lot owner happens to be on the committee that year, so it survives changes in ownership and changes in who’s willing to volunteer their time.

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What Does an Owners Corporation Manage?

Once it’s established, a Victorian owners corporation carries a defined set of legal responsibilities. It must:

Manage and administer the common property
Repair and maintain common property, fixtures and shared services
Take out and keep the required insurance
Raise fees from lot owners to cover its financial obligations
Prepare financial statements and keep proper financial records
Provide owners’ corporation certificates when a certificate is requested
Keep an owners’ corporation register
Set up a grievance procedure for resolving disputes

Disputes between neighbours over parking, noise, or who’s responsible for a leaking pipe are common in shared developments, and having a documented process means most disagreements get resolved without anyone needing to involve the Victorian Civil and Administrative Tribunal (VCAT). Where a dispute can’t be resolved internally, Consumer Affairs Victoria offers a free conciliation service as a first step, with VCAT available to make binding orders if that doesn’t work.

Day-to-day decisions run through a structure of four levels:

The owners’ corporation itself (all lot owners together)
The elected committee
Delegates such as the chairperson or secretary
Any sub-delegates the committee appoints

The committee can make decisions on matters delegated to it, but only the full owners’ corporation can overturn an earlier decision or handle matters requiring a special or unanimous resolution.

Votes aren’t counted per person; they’re counted per lot entitlement. Own two lots, and you generally get two votes. Co-own one lot with a partner, and between you, you get one.

Do You Have to Join an Owners Corporation?

Yes. Membership of an owners’ corporation in Victoria is automatic and mandatory. There’s no application, no waiting period, and no way to decline. If the property you’re buying is affected by common property, you become a member from the moment you become the registered owner, with the legal and financial responsibilities that come with it.

This is worth factoring into your budget before you make an offer. Owners corporation fees are an ongoing cost, and unpaid fees attach to the lot rather than the person, which matters if you’re buying a property with a payment history you haven’t checked yet.

The Five Tiers of Owners Corporations in Victoria

Since 1 December 2021, changes to the Owners Corporations Act 2006 mean every owners corporation in Victoria now sits in one of five tiers, based on the number of occupiable lots (car parks, storage cages and similar accessory lots don’t count towards the total). The old “prescribed” test (more than 100 lots or fees over $200,000 a year) no longer applies on its own.

The tier matters because it sets how much governance and reporting a particular owners corporation has to carry.

The five tiers are:

Tier 1: more than 100 occupiable lots (and not a services-only owners corporation).
Tier 2: 51 to 100 occupiable lots
Tier 3: 10 to 50 occupiable lots
Tier 4: 3 to 9 occupiable lots
Tier 5: a two-lot subdivision, or a services-only owners corporation with no common land or buildings, just shared infrastructure like water or gas metering

Tier 1 owners’ corporations must appoint a manager (unless they opt out by special resolution), have their financial statements independently audited each year, and prepare a formal maintenance plan. Tier 2 owners’ corporations face similar obligations, though their accounts only need to be reviewed rather than audited.

Tier 3, 4 and 5 owners’ corporations have lighter requirements and more flexibility, though a Tier 4 owners’ corporation still has to prepare financial statements for any year in which it levies fees.

If you’re buying into a large apartment complex, expect a Tier 1 or Tier 2 structure with a professional manager, an audited budget and a maintenance plan you can review. If you’re buying a townhouse in a small three-lot subdivision, you’re more likely looking at a Tier 4 or Tier 5 owners corporation, run informally by the owners themselves, which brings its own risks if nobody’s been keeping the books.

Owners Corporation Fees in Victoria

Owners’ corporation fees are levied against lot owners based on lot liability, as set out in the plan of subdivision. These fees typically cover:

Building insurance (reinstatement, replacement and public liability cover)
Maintenance and repair of common property
Utilities and services connected to shared areas, such as lift servicing or garden upkeep
Administrative costs, including preparing financial statements and, where required, an owners’ corporation manager’s fees

Owners corporations with common property (other than two-lot subdivisions) must hold public liability insurance of at least $20 million, along with reinstatement and replacement insurance for buildings on common property. That cost is baked into your regular fees.

On top of ongoing fees, an owners corporation can raise a special levy for one-off costs, such as a re-render after water damage, a lift replacement, or cladding remediation. These can be substantial, so it’s worth asking whether any are planned or already resolved before you sign anything.

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What Should Buyers Check Before Purchasing?

Before you commit to a property with an owners corporation attached, request the current owners corporation certificate. It should be included with the Section 32 vendor statement, or you can request a fresh one directly. The certificate must set out:

Current fees and whether they’ve been paid
Any special levies approved, and when they’re due
Details of insurance cover
Total funds held by the owners’ corporation
Any outstanding notices, orders or legal proceedings involving the owners’ corporation
Whether a manager has been appointed

Because certificates can be prepared up to 12 months before a sale, it’s worth asking your solicitor to request a current one or arrange an inspection of the owners’ corporation register, rather than relying on an older document in the contract pack. If you’re weighing up a purchase more broadly, running through a proper due diligence checklist alongside the owners’ corporation certificate gives you a clearer picture before you’re locked in.

It’s also worth reading the Section 32 vendor statement in full rather than skimming it. The owners corporation certificate is only one part of that disclosure document, and problems elsewhere in the Section 32 can matter just as much as the state of the owners corporation’s finances.

If you’re buying an apartment that hasn’t been built yet, the owners’ corporation questions look a little different again. New developments often start with minimal fee history and projected budgets rather than real figures, so it pays to have a solicitor review the details of your off-the-plan conveyancing contract, including how the developer has estimated fees and what happens if the owners’ corporation structure changes before settlement.

Getting the Right Advice Before You Buy

An owners’ corporation isn’t something to work out after settlement. By then, you’re already a member, with fees and obligations attached, whether the paperwork was clear or not. A Melbourne conveyancer who reads the owners’ corporation certificate closely, checks the tier and history behind it, and flags anything that doesn’t add up can save you from an unpleasant surprise down the track.

This is especially true if you’re selling rather than buying. Vendors are legally required to attach a current owners corporation certificate to the Section 32, and an outdated or incomplete one can hold up settlement or, worse, give the buyer grounds to walk away from the contract. Getting this right the first time is usually far cheaper than fixing it after a sale falls through.

BT Legal works with home buyers, sellers and first home buyers across Melbourne on straightforward, fixed-fee conveyancing that covers exactly this kind of detail. Whether you’re purchasing your first apartment, selling a townhouse with an owners corporation attached, or transferring ownership between family members, our team reviews the paperwork properly so nothing gets missed. Get in touch before you sign, not after.

This article is general information only and does not constitute legal advice. Every property and every owners’ corporation is different, so speak with a qualified conveyancer or solicitor about your specific situation before making a decision.