History of the Unit Titles Act 1972
The Unit Titles Act is the law governing building developments where multiple owners hold a type of property ownership known as a unit title. Such building developments are typically apartment blocks, townhouses, office blocks and industrial or retail complexes.
Unit owners in a unit title development own a defined part of the building, such as an apartment, and may have shared ownership in common areas such as lifts, lobbies or driveways.
Collectively, all the unit owners in a building development make up a body corporate. The body corporate has responsibility for a range of management, financial and administrative matters relating to the common property and to the building as a whole.
Since 1972, when the Act first came into force, there have been major changes in the number, scale and nature of property developments in New Zealand. The Act has therefore become out-dated and is no longer able to provide a sound basis for the creation and sustainable management of intensive, multi-unit developments.
Update 14 September 2010 – Unit Titles regulations
In May/June this year we asked for your views on the content of regulations to support the Unit Titles Act 2010. Your submissions helped form recommendations to Cabinet on what the regulations should cover.
Cabinet has agreed that the regulations will cover:
- the content of disclosure statements between buyers and sellers, and developers and bodies corporate
- body corporate rules
- body corporate democracy and governance
- financial statements
- long-term maintenance plans.
You can download and read the Cabinet paper considered by Ministers in August 2010 and the minute recording the decisions made here:
You should note that the Cabinet paper asks for high-level agreement on what the regulations will cover, so don’t be alarmed if the detail you gave us isn’t in there.
The next step is for the regulations to be drafted. During drafting we will use the detailed information contained in the discussion document and your submissions.
The Department is aiming to have the Unit Titles Act 2010 and regulations in force as soon as possible, however drafting regulations is a complex process and it may take some time. We will continue to provide updates as and when they occur.
Update 14 July 2010 – Unit Titles regulations consultation
In April 2010 a discussion document, Discussion paper on regulations to support the Unit Titles Act 2010, was released for public consultation. The discussion document outlined proposals for required regulations and possible regulations to support the Unit Titles Act 2010. In particular, public opinion was sought on two key questions:
- what the details should be where certain matters need to be described in regulations (e.g. body corporate rules, disclosure, body corporate meetings)
- whether regulation or consumer guidance is more appropriate in other cases (e.g. long-term maintenance, additional governance requirements).
Public consultation closed on 10 June 2010. The summary of submissions is now available »
Update 29 April 2010 – Unit Titles regulations consultation
We would like your views on proposals for regulations to support the Unit Titles Act 2010 (the Act). The Act provides a legal framework for the ownership and management of unit title developments. Read the Minister of Housing's media release
and read the discussion document »
Update 1 April 2010 – Unit Titles Act passes into law
On 1 April 2010 the Unit Tiles Bill received its third reading in Parliament. Read the Minister’s announcement.
The next step is for the Bill to gain Royal Assent, where the Governor-General assents to the bill becoming law.
Regulations will be developed to support the new Act, and then the new Act will come into force.
A discussion document will be released by the Department of Building and Housing for public comment on the technical and operational details of the Act. An update will be posted here when submissions are open.
The Unit Titles Act 2010 makes a number of changes to the Unit Titles Act 1972, including:
- Clarifying the definition of a principal unit.
- Streamlining the process under which a development is built in stages.
- Creating a fair system for calculating how much a unit owner should contribute to body corporate funds.
- Stating that the body corporate owns the common property.
- Clarifying the rights and responsibilities of unit owners and bodies corporate.
- Creating fair and transparent governance and management structures.
- Lower the voting threshold for body corporate decisions from a unanimous resolution to a 75 percent agreement.
- Provide a comprehensive disclosure regime for buyers and sellers, developers, and bodies corporate.
- Provide a fully integrated and cost effective dispute resolution service through the Tenancy Tribunal.
Update March 2010 – Committee of the Whole stage
The Unit Titles Bill completed the Committee of the Whole stage on Thursday 25 March 2010.
A Supplementary Order Paper was tabled by the Minister, which proposed some minor and technical amendments to the Bill such as correcting typographical errors and incorrect cross-references. The Supplementary Order Paper also proposed some other changes, in the form of re-drafting certain clauses, moving clauses around and adding in new clauses. The purpose of the Supplementary Order Paper was to provide more clarity around some of the processes in the Bill, so people who need to use them know what they have to do and how they are required to do it.
View the Supplementary Order Paper here
.
The next step is for the Bill to receive its third reading. The timing of the third reading depends on whether there is enough time in Parliament and competing Government priorities. You can track the Bill on the Order Paper, which sets out Parliament’s agenda on any day the House is sitting. Alternatively, the Department will post another update on this site when further progress is made.
Update March 2010 – second reading
The Unit Titles Bill completed its second reading in Parliament on Tuesday 16 February 2010. Read the Minister's announcement.
The next step is for the Bill to be considered by the Committee of the Whole House. This is where the provisions of the Bill are debated in sections and members can propose changes, in the form of a Supplementary Order Paper.
The timing of the Committee stage depends on whether there is enough time in Parliament and competing Government priorities. You can track the Bill on the Order Paper, which sets out Parliament’s agenda on any day the House is sitting. Alternatively, the Department will post another update on this site when further progress is made.
Update October 2009 - Select Committee report-back
On 2 September 2009 the Social Services Committee tabled its report on the Unit Titles Bill. You can read the Committee’s report here.
The next step is for the Bill to have its second reading. The timing of the second reading debate depends on whether there is enough time in Parliament's programme and competing Government priorities. You can track the Bill’s progress on the Order Paper, which sets out Parliament’s agenda when the House is sitting.
Before becoming law the Bill must pass through several more parliamentary stages, including consideration by Committee of the Whole House, and receive Royal Assent. You can find out more about the Parliamentary stages a bill needs to go through to become law in the Parliament website.
Update: First reading and select committee referral
The Unit Titles Bill had its first reading in Parliament on 5 March 2009. Read the Minister's announcement.
The Unit Titles Bill 2008 has now been referred to the Social Services Select Committee for consideration. The Committee has requested public submissions on the provisions contained in the Bill. Details on how to make a submission can be found on Parliament's website.
If you intend on making a submission, you can download the document that details the indicative content of regulations [PDF 75KB, 14 pages] that could be prescribed under a new Unit Titles Act. This document is not part of the consultation on the Bill, but is designed to help you make an informed submission by giving you more information about how the changes prescribed in the Bill will work.
After Select Committee consideration and report to Parliament, the Bill must pass through a second reading, the Committee of the Whole House, a third reading and gain Royal Assent before passing into law. Updates on the progress of the Unit Titles Bill through the parliamentary process will be posted on this website as and when they occur.
What's happening with the review in 2008?
A draft Unit Titles Bill was completed in February 2008. The Bill has now been introduced into Parliament. You can download a copy of the Bill from the Parliament website . Alternatively you can obtain a hard copy from bennets bookstores or Legislation Direct
The next step is for the Bill to receive its first reading debate in Parliament. The timing of the first reading debate depends on whether there is enough time in Parliament's programme. If the Bill passes its first reading it will be sent to a select committee for consideration. The Department will not be conducting further public consultation on the Bill - this is carried out by the select committee. The select committee will usually invite public submissions by advertising in major daily newspapers and on the Parliament website.
You can find out more about the Parliamentary stages a bill needs to go through to become law on the Parliament website.
New legislation: the process for the Unit Titles Bill in 2007
The Department spent much of 2007 working with the Parliamentary Counsel Office to draft the Unit Titles Bill based on policy decisions that were made by Cabinet in late 2006 (see below). This work was completed in February 2007. Introduction of the Bill is planned for early 2008.
The Select Committee will be responsible for public consultation on the Bill. You will be able to contact the Clerk of the Select Committee to receive a copy of the Bill and have the opportunity to make a submission. The Select Committee will advertise for submissions in major daily newspapers and on the Parliament website
Proposals For Changes to the Act Agreed In 2006
On 27 November 2006 Cabinet agreed to policy proposals for legislative change to the Unit Titles Act 1972. These policy decisions will form the basis for rewriting the Act. To read the Minister's announcement, please continue
Summary of agreed changes to the Unit Titles Act 1972
The changes will:
- Make managing unit title developments easier and more efficient by clarifying rights and responsibilities of unit owners, the body corporate, developers and tenants, and by allowing the body corporate to act on behalf of all the unit owners for the good of the development as a whole.
- Make joint decision-making by the body corporate easier by promoting participation and by removing requirements for unanimous resolution.
- Make information more readily available to purchasers, unit owners and the body corporate so that they can make informed choices by introducing disclosure requirements for vendors and developers.
- Establish effective ways to sort out problems and move forward by providing for the Government to establish a dispute resolution service for unit title matters covering education and information, mediation and adjudication.
- Encourage sound property management practices that will protect the long-term value of investments by introducing requirements for long-term maintenance plans and long-term maintenance funds by the body corporate; and by broadening the role of the body corporate in relation to maintaining and managing the building as a whole.
- Make survey and title processes more streamlined for surveyors and developers by making the staged development process more flexible.
- Allow for large, staged or complex unit title developments to be set up and managed more easily by providing for ownership structures to include ownership of common property by the body corporate.
Public consultation in 2004/05
The Unit Titles Act Discussion Document was published in November 2004. Public consultation was held between November 2004 and March 2005. During this time public consultation meetings were held in Auckland, Wellington and Christchurch, and 138 written submissions were received.
The submissions were analysed and summarised in the following summary of submissions. Unit Titles Act Summary of Submission (June 2005) [PDF 205 KB, 42 pages].
Although the submission period has closed you can still read the discussion document: Unit Titles Act discussion document which is also available in PDF Unit Titles Act discussion document PDF [PDF 110 KB, 41 pages].
Public consultation in 2006
The Department developed a number of options for change to the Act to address the issues raised from public consultation in 2004/05. This policy work was done in consultation with Land Information New Zealand, the Ministry of Justice and an external reference group.
This led to the release of a discussion document, Options for Change. While the consultation period for response to this document closed on 2 June 2006, you can still read the discussion document: Options for Change which is also available in PDF. Options for Change PDF [PDF 732 KB, 39 pages].
148 submissions were received during the May/June 2006 public consultation on Options for Change. The submissions have been analysed and summarised in the following summary of submissions. Summary of Submissions Report (July 2006) [PDF 129 KB, 22 pages].
Media releases