Unit Titles Bill progresses

A bill modernising the way apartment blocks are managed has received its second reading in Parliament following scrutiny by the Social Services Select Committee.

Housing Minister Phil Heatley said the committee had improved the Unit Titles Bill, which brings New Zealand's unit title law into the 21st century.

Mr Heatley said the bill was sensible and pragmatic and supported by many in the property industry and beyond.

"My office is full of letters from members of the public keen to see this bill become law," he said.

"New Zealand's property market has grown and become more complex as its population has expanded.  Some apartment buildings particularly in Auckland now contain hundreds of units.

"It's obvious the current legislation has become inadequate," he said. 

"The changes made following the select committee's recommendations have improved the bill.

"It is more flexible, will reduce compliance costs and lessen the regulatory burden for unit owners and bodies corporate.

"It's clear the committee supports the government's goal of creating a regulatory environment that imposes the bare minimum of regulatory cost and red tape.  I wholeheartedly agree with the recommendations made."

The select committee made a number of changes to the bill to accommodate concerns raised in submissions that certain parts were overly prescriptive, with suggested changes making the bill more flexible and reducing compliance costs.  Key changes include:

• making the long-term maintenance regime more flexible

• changes to financial monitoring and reporting provisions to lower compliance costs for bodies corporate, while still providing unit owners with robust mechanisms to protect them from the misuse of funds

• an amendment allowing carparks to be treated as principal units

The bill is intended to modernise the way apartment blocks are built and managed.  It repeals and replaces the outdated Unit Titles Act 1972, and is the result of a comprehensive review, in response to the intensive growth in apartment-style living that has taken place over the last 30 years.

Notes:

The select committee received 101 written and heard 36 oral submissions and reported back to the house on 2 September 2009 with recommendations.

The bill will make setting up unit title developments easier and more flexible, as well as streamline and simplify the way multi-unit developments are managed.  Some of the Bill's proposed changes include:

• increased disclosure provisions

• introduction of a dispute process through the Tenancy Tribunal

• clarification of rights and responsibilities, particularly in respect of common property ownership, repair and maintenance

• introduction of utility interests to allow bodies corporate a fairer, more equitable means of apportioning operational and maintenance costs among unit owners

What will be the bill's impact on multi-unit developments?

The new staged and layered development provisions will make it easier and less costly for developers to build new multi-unit developments.

New voting requirements under the bill will make decision-making and management easier and faster for bodies corporate.

The new long-term maintenance regime will promote best management planning practices to support the changing nature of New Zealand's built environment and the trend towards apartment style living.

New dispute provisions under the Tenancy Tribunal will provide greater access to justice for those involved in disputes who were previously unable or unwilling to afford court costs.

A clarification of rights and responsibilities as well as increased disclosure provisions will prevent disputes from arising.

The next step in the process is for the bill to be considered at Committee of the Whole stage.  For further information, see the Parliament website www.parliament.nz or the Department of Building and Housing website www.dbh.govt.nz