The Unit Titles Act 2010 in New Zealand: How It Affects Apartment and Townhouse Buyers

What Is the Unit Titles Act 2010?

The Unit Titles Act 2010 is the primary legislation governing unit title properties in New Zealand. It replaced the earlier Unit Titles Act 1972 and introduced significant changes that affect every apartment, townhouse, and unit-title property owner in the country. If you're buying, selling, or living in a unit title property, understanding this Act is not optional — it's essential.

The Act covers everything from how a unit title development is created and managed, to your rights and obligations as a unit owner, to how disputes are resolved. It works alongside the Building Act 2004 and the Resource Management Act 1991 to create the full regulatory picture for unit title properties.

Unit Title vs Freehold: What's the Difference?

When you buy a freehold property, you own the land and the buildings on it outright. When you buy a unit title property, you own your specific unit plus a share in the common property (driveways, gardens, lifts, gym, roof, foundations). Your ownership is defined by your unit entitlement, which determines both your voting rights and your share of body corporate expenses.

This distinction has real financial consequences. As a unit owner, you're responsible not just for your own unit's maintenance but for a proportionate share of all common property costs. For a deeper comparison, see our guide on Unit Title vs Freehold in New Zealand.

Key Changes Under the 2010 Act

The 2010 Act introduced major reforms that protect buyers and improve governance. Here are the most important changes:

Pre-Purchase Disclosure

Sellers must now provide a pre-contract disclosure statement before a sale agreement is signed, and a pre-settlement disclosure statement before settlement. These documents must include:

• Body corporate financial statements for the last two years
• Details of any pending legal proceedings
• Current and projected maintenance plans
• Outstanding levies or special levies
• Details of any weathertightness claims
• The long-term maintenance plan and fund balance

Buyers who don't receive adequate disclosure may have the right to cancel the contract — a significant protection that didn't exist under the old Act.

Body Corporate Governance

The Act strengthened body corporate governance requirements:

• Committee structure: Bodies corporate with 10 or more units must have a committee. Smaller developments may operate without one.
• Decision-making: Ordinary resolutions require a simple majority; special resolutions require a 75% majority; unanimous resolutions require 100% agreement.
• Professional management: Bodies corporate may engage a professional body corporate manager, but are not required to.

Long-Term Maintenance Planning

Every body corporate must now maintain a long-term maintenance plan covering at least 10 years (previously, this wasn't required). This plan must be reviewed annually and include projected costs for maintaining common property.

Dispute Resolution

The Act created a clearer pathway for resolving disputes within unit title developments, including access to the Tenancy Tribunal for disputes that can't be resolved internally. This covers disputes about levies, maintenance, noise, pets, and committee decisions.

What Your Record of Title Shows for a Unit Title Property

When you order a Record of Title with Diagram ($42.90) for a unit title property, you'll see:

• The unit number and legal description
• Your unit entitlement (your share of common property)
• Any mortgages, caveats, or encumbrances registered against your specific unit
• References to the unit plan showing boundaries between your unit and common property
• Any easements affecting your unit (e.g., right of way through common property)

The title won't show the full body corporate rules or financial position — that's what the disclosure statements are for. Always order both the Record of Title and request the disclosure statements before buying.

Common Property and Your Obligations

Under the Unit Titles Act 2010, common property is everything that isn't defined as a principal unit or an accessory unit. This typically includes:

• Building structure (roof, exterior walls, foundations)
• Common areas (lobbies, hallways, lifts, stairwells)
• Shared facilities (swimming pool, gym, gardens, parking areas)
• Infrastructure (pipes, wiring, drainage serving multiple units)

As a unit owner, you must contribute to the maintenance of common property through your body corporate levies. These are calculated based on your unit entitlement and are legally enforceable — the body corporate can recover unpaid levies as a debt.

Buying a Unit Title Property: Your Checklist

If you're considering purchasing an apartment or townhouse under unit title, here's what you need to do:

1. Order a Record of Title — Get a current Record of Title with Diagram ($42.90) to verify ownership, unit entitlement, and any encumbrances.
2. Request pre-contract disclosure — The seller must provide this. If they don't, you have grounds to cancel the agreement.
3. Review the body corporate rules — These may restrict pets, renovations, noise levels, or short-term rentals (Airbnb).
4. Check the long-term maintenance plan — Is it fully funded? Are major expenses looming? A poorly funded maintenance plan could mean hefty special levies.
5. Order a Guaranteed Search ($45.90) — This provides the most authoritative view of what's registered against the title at the time of purchase.
6. Check for weathertightness claims — The disclosure statement must reveal any current or pending leaky home claims.
7. Review financial statements — Check the body corporate's bank balance, insurance cover, and whether there are any outstanding special levies.

Our Pre-Purchase Diligence Package ($189.90) includes the Record of Title, Guaranteed Search, and Survey Plan — the essential title documents for any unit title purchase.

Selling a Unit Title Property: Your Obligations

Sellers have specific obligations under the Unit Titles Act 2010:

• You must provide a pre-contract disclosure statement before the buyer signs the agreement
• You must provide a pre-settlement disclosure statement at least 5 working days before settlement
• Both statements must include specific financial and governance information about the body corporate
• Failure to provide adequate disclosure gives the buyer the right to cancel or seek compensation

Special Levies and Financial Surprises

One of the biggest risks for unit title buyers is special levies — one-off charges imposed by the body corporate to cover unexpected expenses. These can run into tens of thousands of dollars per unit.

Common triggers for special levies include:

• Major waterproofing or cladding repairs (especially in leaky buildings)
• Lift replacement or major structural work
• Earthquake strengthening (seismic remediation)
• Insurance premium increases after natural disasters

This is why reviewing the long-term maintenance plan and body corporate financial statements is non-negotiable before buying. For more on weathertightness risks, see our guide on Weathertight Homes and Property Title Searches.

Unit Titles Act and Body Corporate Management

The Act provides the framework for how bodies corporate operate. Key governance points:

• Annual general meeting: Must be held within 3 months of the body corporate's balance date
• Quorum: Requires at least 25% of unit owners (by entitlement) or 3 owners (whichever is greater)
• Voting: Each unit gets one vote per unit entitlement dollar, with a maximum cap for large units
• Insurance: The body corporate must insure all units and common property for full replacement value

For a complete guide to body corporate management and title searches, see our Body Corporate Title Searches Guide.

Changes Coming: What Buyers Should Watch For

The Unit Titles Act 2010 has been subject to ongoing amendment proposals. Key areas of potential change include:

• Stronger protections for first-time buyers in unit title developments
• Greater transparency requirements for body corporate managers
• Improved dispute resolution processes through the Tenancy Tribunal
• Enhanced disclosure requirements for weathertightness and seismic risk

Always check the current version of the Act and any recent amendments before making purchasing decisions.

How to Protect Yourself When Buying a Unit Title

1. Order a current Record of Title with Diagram ($42.90) to verify the unit's legal status and entitlement
2. Request the pre-contract disclosure statement from the seller
3. Review the body corporate rules, financial statements, and long-term maintenance plan
4. Check for any registered instruments or encumbrances with a Document Image ($39.90)
5. Consider ordering a Guaranteed Search ($45.90) for the most authoritative title information
6. Engage a lawyer experienced in unit title transactions — the complexities of the Act require specialist knowledge

Frequently Asked Questions

Can a body corporate force me to pay a special levy?

Yes. If the body corporate passes a special levy resolution (typically requiring a 75% majority by unit entitlement), all unit owners must pay their share. The levy is legally enforceable, and unpaid levies can be recovered as a debt through the Tribunal.

Do I own the land under my unit title apartment?

You own a share of the land as part of your unit entitlement, but you don't own a specific piece of land outright. The land is held collectively by all unit owners through the body corporate. Your Record of Title will show your unit entitlement, which represents your proportionate share.

Can I renovate my unit title apartment?

It depends on what you're renovating. Internal changes within your unit are generally your responsibility, but any work that affects common property (exterior walls, structure, shared plumbing or wiring) requires body corporate approval. Always check the body corporate rules and obtain written consent before starting any renovation.