Property guidance by Quay Law
Property guidance by Quay Law
Unit title guidance from Quay Law
Ian Mellett, Barrister and Solicitor, Quay Law
Principal units have an ownership interest and a utility interest. Ownership interest affects voting on a poll and certain ownership rights. Utility interest generally determines contributions to body corporate levies. Checking both helps you understand your obligations.
Ownership interest is assessed by a registered valuer when the unit plan is deposited, and it is recorded on the plan. It reflects the relative value of each unit within the development.
Ownership interest is used to determine:
A larger or more valuable unit will generally carry a higher ownership interest. Its share of levies depends on the utility interests that apply.
Utility interest is the basis generally used to allocate body corporate levies. It initially equals ownership interest, but may be reassessed under the Act. Different sets can allocate particular expenses according to how owners use or benefit from a service.
Since 9 May 2023, bodies corporate have been able to use multiple sets of utility interests for different costs. A common example is lift maintenance, where owners of ground floor units who do not use the lift may contribute less, or nothing, towards its cost.
Ownership and utility interests can be reassessed in certain circumstances, following the procedures set out in the Unit Titles Act 2010. Reassessment can change the share of costs borne by each owner, so proposals to reassess should be considered carefully.
Before buying, we recommend checking:
Two similar units in different developments can carry very different levy obligations depending on how these interests are set.
How body corporate levies are set in New Zealand, what the operating, maintenance and contingency funds are for, and how special levies work.
How to read a unit plan, the difference between principal and accessory units, and why boundaries matter when you buy an apartment or townhouse.
What the Unit Titles Amendment Act 2022 changed for buyers, sellers and owners, including disclosure, maintenance plans, managers and meetings.
If you are comparing units or questioning the levies on a unit you own, we can explain how ownership and utility interests affect you.
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.