A swathe of Australia's top consumer groups have penned a joint letter to the federal treasurer calling for an urgent inquiry into the strata management industry.

A national probe into the sector has also been supported by the New South Wales and Queensland governments, and industry groups. 

The open letter to Treasurer Jim Chalmers has been endorsed by Choice, the Owners Corporation Network, the Australian Consumers Insurance Lobby and seven others.

It requests Mr Chalmers immediately direct the Australian Competition and Consumer Commission (ACCC) or the Productivity Commission to conduct an inquiry into the sector.

"This action is necessary to safeguard the interests of millions of Australians currently living in strata-titled properties and to protect the interests of future strata owners," a statement accompanying the letter read.

On Tuesday morning NSW Housing Minister Rose Jackson said she would welcome the move.

"The NSW government would be keen to work with the Commonwealth on some kind of national inquiry and investigation," she said.

"We recognise this is a problem. We've already started with a package of legislative reform but know there is more to do."

A spokesperson for the Queensland government said it would support and contribute to an ACCC inquiry.

On Monday, an ABC Four Corners investigation exposed how the strata industry was rorting apartment owners who were largely unaware of hidden fees, secret commissions and kickbacks being pocketed at their expense.

In one instance, the country's biggest strata insurance broker, Steadfast, was found to have recommended a more expensive policy, offered by a firm it owned, without showing clients a cheaper quote from a competitor.

Steadfast Group denied it withheld the alternative quote and said its brokers were not misleading customers.

Shares in the $7 billion publicly traded insurance giant tumbled before it entered a trading halt late on Monday.

The broadcast also revealed a subsidiary of one of the world's largest strata companies had charged a $945 fee for a report that Sydney apartment owners could not account for.

And in another case, management firm Strata Plan was accused of charging two apartment owners in a Melbourne complex more than $100 to chase up a 60c debt they owed on their levies.

Earlier this year the ABC also revealed Netstrata had been charging insurance brokerage fees as high as three times the usual rate and receiving kickbacks from contractors and suppliers it hired using apartment owners' strata funds.

Following the March broadcast, the NSW government introduced a bill to parliament aimed at boosting oversight of the industry and improving strata disclosure requirements. Other states are yet to act.

Strata legislation varies between states and territories, and consumer groups hope a federal inquiry will produce recommendations that will bring all consumer protections into line.

Owners Corporation Network executive director Karen Stiles, who represents apartment owners, told the ABC that state regulators had failed to take strata ownership seriously for decades and "it's time for the federal government and regulators to act".

She noted the ACCC was able to pursue legal action against large firms, which could result in a court order for redress.

The ACCC also has the power to compel parties to provide information and documents or give evidence under oath.

The consumer groups said key issues plaguing the industry include "widespread questionable, unethical or unlawful practices by strata managers", a lack of transparency in remuneration models, a persistent failure in industry and government oversight and harmful debt recovery practices.

In their joint statement, they told the treasurer one signatory had recently learned of more than 140 alleged cases where strata managers had "unlawfully appointed insurance brokers, causing significant harm" and "that was merely the tip of the iceberg".

Real Estate Institute of NSW CEO Tim McKibbon said an inquiry could restore trust in the sector.

"The majority of good strata managers out there in the community doing a good job would be cringing at what happened last night and realising their reputation has been tarnished," he said.

"Currently our strata laws and the oversight of the industry has been demonstrated to be wanting."

A spokesperson for the federal government said it was "very concerned" about the issues raised and "open to dialogue about what the Commonwealth can do".

Mr Chalmers has previously directed the ACCC to conduct an inquiry into the supermarket sector after identifying concerns over pricing practices.