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Proposed changes to apartment ownership rules welcomed

Proposed changes to apartment ownership rules welcomed by body corporate sector

Proposed changes to the laws governing apartment ownership have been welcomed by New Zealand’s body corporate property management sector.

The planned changes – outlined in a discussion paper prepared by the Ministry of Business Innovation and Employment – have been designed to tighten apartment ownership-related operations.

The mooted improvements up for discussion are the first step in a process of revising the Unit Titles Act 2010 which covers ownership of apartments and multi-unit dwellings.

The MBIE paper encompasses six significant changes to the ownership and management of apartment complexes and individual units within those developments. The proposed changes include:

• Better disclosure rules to ensure potential buyers know earlier in the apartment-purchasing process of all the relevant information about a unit or apartment, and the associated governing body corporate

• Strengthening body corporate governance to empower owners to make decisions regarding their development by exercising their property rights

• Increasing the professionalism of body corporate managers by providing a strong and clear governance framework

• Ensuring long-term maintenance plans are credible, active and are supported by accurate documents

• Varying compliance requirements relating to the size of the development, as there is the potential need for differing compliance requirements depending on the size of the complex


• Improving the accessibility to dispute resolution processes and assessing whether the Tenancy Tribunal is best placed to resolve disputes.

The raft of legislative amendment changes has been welcomed by the head of leading apartment body corporate manager Auckland Body Corporate, Chris Newman, who said the regulatory ‘shake-up’ was critical to the future of New Zealand’s cities.

“High-density development can only be undertaken with investment support, which in turn needs greater confidence from property owners,” Mr Newman said.

“Within those legislative change proposals are moves to raise the professionalism of the body corporate sector - which for too long as been tarnished by the actions of poorly run in-house bodies corporate or proverbial ‘cowboy’ administration companies.

“Such substandard body corporate management companies will find life difficult to work under the new regulations.

“Ultimately, the changes will led to a consolidation of services administered by professional body corporate businesses and a much easier ownership life for tens of thousands of apartment owners al over New Zealand.”

According to Government statistics, there are 145,000 New Zealand households living in apartments and townhouses – with this number expected to double by 2040.

“There will be fall out for the body corporate sector,” Mr Newman said.

“We have already been brought in by a score of Auckland apartment owners preparing for what they believe will be the weeding out of poor performing body corporate management operations.”

Mr Newman said Auckland Body Corporate’s free ‘health check’ analysis included a full review of an apartment block’s body corporate current budget, service contracts, health and safety plan, and long-term property maintenance schedule.

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