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Bill to modernise apartment laws set for introduct

28 April 2008

Bill to modernise apartment laws set for introduction

A Bill to modernise apartment-ownership and body corporate laws – The Unit Titles Bill – will be introduced to Parliament shortly by Building and Construction Minister Shane Jones.

Mr Jones said the Unit Titles Act 1972 is archaic and out of touch with modern property development and, the changes proposed in the Unit Titles Bill will bring the legislation into the 21st century.

The bill will make unit title developments easier to manage and provide greater flexibility for both unit title owners and bodies corporate.

Mr Jones said he had received dozens of letters on a wide range of issues from people living in unit title developments.

“Time and again we have issues where unit owners are being hard done by. For example, I’ve heard of people buying an apartment then finding out the developer has locked the body corporate into a costly and unfair contract for services that the owners can’t get out of. The bill will help these unit owners by providing access to dispute resolution services so they can renegotiate the contract or, if the contract is really unfair, have it cancelled.

“I’ve also heard from people who are facing huge one-off levies for big ticket maintenance costs, like getting a new roof. Some people find it hard to come up with this kind of money, especially if they are on a fixed income or have mortgage payments to meet. The bill will prevent these sorts of situations arising because the body corporate will be required to plan for maintenance and unit owners will contribute to future costs on a yearly basis.”

Mr Jones says the Bill will also help people living in a leaky building, especially those who are going through the repairs process.

“Unit owners have come to me because they live in leaky buildings and are trying to get repairs done, but the process is frustrated by one or two unit owners who don’t think they should be paying to repair the building. While the body corporate tries to sort out the argument the building continues to deteriorate and unit owners have to live every day in a leaky home. The bill will empower the body corporate to act for the development as a whole and get the repairs done.”


Mr Jones says the review included consultation on two discussion documents to find out how unit owners, bodies corporate and the property development sector thought the Act should be changed.

He says unit title developments such as apartments and townhouses were a new housing style when the Unit Titles Act came into force 36 years ago.

“The Act was developed to deal with developments that, by today’s standards, are very small and uncomplicated but there have been major changes in the past few decades in the number, scale and nature of residential and commercial property developments.

“That trend is expected both to continue and to accelerate, particularly in the Auckland region, where it is estimated that within 50 years 500,000 people will be living in apartments, townhouses and high-rise buildings.”

There are currently an estimated 16,422 unit title developments in New Zealand comprising 95,416 units. Approximately 88 percent these developments have nine or less units. Approximately 70 percent of all unit title developments are residential. The rest are commercial, industrial and a small number in the horticultural, agricultural and mining sectors.
Mr Jones says the 1972 Act is no longer able to provide a sound basis for the creation and sustainable management of intensive, multi-unit developments.

“In particular, unit title tenure nowadays does not work well for developments that are complex, built in stages or have mixed uses.

“The proposed changes will provide broader and more adaptable ways of setting up and managing multi-unit living, both now and in the foreseeable future.”

ENDS


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