AAA Applauds Victoria’s Building Insurance Reform — But Warns Strata Laws Are Letting Residents Down

The Australian Apartment Advocacy (AAA) has welcomed the Victorian State Government’s landmark move to introduce decennial liability insurance for apartment buildings over four storeys, calling it a long-overdue step toward restoring confidence in apartment construction.

However, the organisation has issued a stark warning: without urgent reform of strata governance laws, the State risks undermining its own progress.

AAA CEO Samantha Reece said while fixing the built form is critical, the Government has been “weak-kneed” in addressing systemic failures in strata governance that leave residents exposed.

“This is a significant win for consumers. Buyers will finally have greater confidence that what they’re purchasing is structurally sound and backed by meaningful protection,” Ms Reece said.

“But let’s be clear — buildings don’t just stand up physically, they also need to function fairly. Right now, Victoria is failing apartment residents where it matters most: governance.”

Developers Still Holding the Power

The AAA highlighted a recent Annual General Meeting attended by Ms Reece this week as a clear example of ongoing governance abuse.

Despite six resident nominees competing for seven committee positions, the developer used 17 proxy votes — beyond the 5% allowable — to override resident representation.

The result:

• Only one resident secured a position on the Owners Corporation Committee

• The developer took three positions, maintaining effective control of the building

“I sat in a room this week and watched democracy get steamrolled and the Strata Manager was complicit,” Ms Reece said.

“Residents showed up, they nominated, they engaged — and it didn’t matter. Proxy farming handed control straight back to the developer.”

“This isn’t governance. It’s manipulation — and it’s happening across Victoria.”

Call for Immediate Reform

AAA is calling on the Victorian Government to urgently align strata legislation with its building reform agenda, including:

• Banning developers and strata managers from holding proxies

• Establishing an independent Strata Commissioner to oversee disputes and governance

• Strengthening protections to ensure residents, not developers, control their communities

“If Victoria is serious about fixing the apartment sector, it must tackle both sides of the equation,” Ms Reece said.

“You can’t strengthen the concrete and ignore the culture. Without governance reform, consumer confidence will remain fragile.”

1.2 Million Victorians at Stake

With 1.2 million people living in strata across Victoria, AAA warns that failure to act risks suppressing apartment demand and undermining housing supply goals.

“Over a million Victorians are living in strata communities — they deserve protection on all fronts,” Ms Reece said.

“If buyers fear they’ll be locked out of decision-making in their own homes, they simply won’t buy.”

“And if that happens, apartment uptake will languish — no matter how strong the building warranty is.”

Final Word

AAA urged the Government to act decisively and quickly.

“The Government has taken a strong step on construction quality — now it must show the same courage on governance,” Ms Reece said.

“Victoria has an opportunity to lead the nation. But it will only do so if it stands up for residents, not developers.”

AAA was involved in the recent exposure of Ace Body Corporate who were caught red handed asking for a $20,000 kickback.