What to know about buying a unit

There are several types of unit ownership in Aotearoa New Zealand: unit titles, cross leases, and sometimes company shares.

According to the Real Estate Authority, under a unit title, the property is owned by a body corp, of which your share, or unit, is a part.

The body corp will be responsible for the care and management of the property’s shared areas. You will pay a levy to the corp for this.

Each corp will have rules and requirements you can ask to see, and minutes you can inspect before buying.

A cross lease gives joint owners a proportionate share of the property, which is owned freehold – there will be no body corp levies, each owner will be responsible for their own property.

Before buying a cross lease property, it is crucial to ensure the layout of your unit is correctly described in the build plan, or the lease could be considered ‘‘defective’’. Fixing that could cost a lot of money.

Agents selling units on a cross lease should have access to the lease documents, which contain any limits or restrictions you need to know about before buying, such as whether you can make alterations to the unit, or build on land around the unit.

Company shares are more common in apartment blocks. A company share means the building and units within it are owned by a company – the company may also own the land, or it could be leasehold.

Buying a unit here means you either buy a share in that company, or you buy a right to reside from the company.

Your rights, limits and obligations will be outlined in the company constitution.