Property guidance by Quay Law
Property guidance by Quay Law
Unit title guidance from Quay Law
Ian Mellett, Barrister and Solicitor, Quay Law
The pre contract disclosure statement is the most important document in a unit title purchase. It is your first real look at the body corporate you are about to join, and since May 2023 it has become considerably more detailed.
This page explains what the statement must contain, how to read it and what happens if it is not provided properly.
Under the Unit Titles Act 2010, a seller of a unit title must give a prospective buyer a pre contract disclosure statement before the buyer enters into an agreement to purchase. The statement is signed by the seller.
Its purpose is to make sure you understand the unit, the body corporate and the obligations that come with ownership before you are committed. The previous prescribed form has been repealed, and templates are now available from the government’s unit titles website, unittitles.govt.nz.
In practice, the statement and its attachments may run to a substantial bundle of documents. It is common for buyers to receive it alongside the agreement and to feel under pressure to sign quickly. We recommend resisting that pressure until the statement has been reviewed, or making your agreement conditional on a satisfactory review.
Following the 2022 reforms, the pre contract disclosure statement must include or be accompanied by, among other things:
Each document in the bundle tells part of the story. The value lies in reading them together.
Minutes record what owners have actually discussed. Look for repeated references to leaks, repairs, insurance claims and works that have been deferred. A matter that appears in several consecutive sets of minutes is rarely minor.
The plan shows what the building is expected to need and when. Check whether significant items fall due in the next few years, and whether the costs look realistic for a building of that age and type.
The financial statements show whether the body corporate lives within its budget. Compare the fund balances with the costs in the maintenance plan. A large gap between the two suggests that a special levy, or a sharp rise in regular levies, may follow.
Since 9 May 2023, a buyer may delay settlement or cancel the agreement if the pre contract disclosure statement is late, incomplete, inaccurate or not provided at all. These rights require notice to the seller and an opportunity to remedy the problem, and the steps in the Act must be followed precisely. Our page on late or incomplete disclosure explains the process in more detail.
We read the statement and every attachment, cross check the minutes, finances and maintenance plan against one another, and take you through what we have found. Where something is unclear or missing, we raise it with the seller’s lawyer before your conditions expire.
What to check before buying an apartment or townhouse on a unit title: the title, disclosure, minutes, finances, maintenance plan, insurance and building.
What to look for in body corporate AGM and committee minutes and financial statements before buying a unit title, explained by Quay Law Auckland.
What a body corporate long term maintenance plan must contain since 2024, how to read one before buying, and the warning signs to look for.
Since May 2023 buyers may delay settlement or cancel if unit title disclosure is late, incomplete or inaccurate. How the process works for buyers and sellers.
What the Unit Titles Amendment Act 2022 changed for buyers, sellers and owners, including disclosure, maintenance plans, managers and meetings.
If you have received a pre contract disclosure statement and are considering an offer, send it to us before you sign.
If you are buying or selling a unit title property in Auckland, we recommend speaking with us before you sign an agreement. Contact Ian Mellett at Quay Law, Barrister and Solicitor, by completing our enquiry form below, or call us on 09 523 2408.
The information on this page is provided for general information purposes only and is not legal advice. Every transaction is different, and all matters should be discussed with the team at Quay Law.