A body corporate advisor believes many Queenstown duplex owners don’t realise they’re affected by the new Unit Titles Act.
Queenstowner Sue Bradley says these unit owners risk being caught out when they try to sell.
The new Act means unit owners must supply would-be buyers full information about the body corporate – or owners’ management collective – that runs their complex.
This includes disclosure documents on the body corporate’s maintenance programme, finances, insurance and levies.
Bradley says the Act – which fully comes into effect this month – was meant for large apartment developments but also covers the likes of two side-by-side units on one property.
“There are a lot of duplexes in Queenstown – you’ve only to go to Fernhill to see the number of houses that are A and B.”
Bradley says these duplex owners may not realise their new obligations and may be faced with a last-minute crisis if they wish to sell.
“There are some people who’ve been very stressed about this whole thing.”
Bradley warns that duplex owners trying to sell face delays or even the cancellation of their sale if they can’t produce disclosure documents to would-be buyers.
Those documents, in turn, can only be produced if all the owners of an apartment block have formed a body corporate, held an annual general meeting and got their paperwork in order.
Bradley warns a duplex owner who’s not in a body corporate might even struggle to find who owns their next-door units, especially if the owner’s overseas.
The Department of Building and Housing, which administers the Act, fortunately tends to show leniency towards smaller body corporates, she says.
“They even joke about having your AGM at the TAB and writing your maintenance plan on a beer mat.
“Theoretically, there’s supposed to be about a four- or five-week lead-in to an AGM but it is possible to have it happen quite quickly,” Bradley says.
Bradley says unit owners in small body corporates can decide, at their AGM, to opt out of the more onerous requirements of the Unit Titles Act.
An example is setting up a separate fund for a 10-year maintenance plan.
“Everybody still needs to do a 10-year maintenance plan but it can be a very basic thing.
“If you are a two-unit property, then you probably don’t need to set aside thousands of dollars for the communal driveway.
“There is the possibility for you to opt out of that and agree to pay for each maintenance item as and when required.”
Bradley recommends unit owners get their body corporate sorted out before any last-minute, pre-sale stress.
“They can take their time over the documents and think more carefully about what they want to put into them.”
They might also seek some professional advice and share the cost for it.
Bradley, for example says she offers a $300 start-up package through her company, Property Support Services.