Purchasing a Unit Title Property

As an owner of a unit title property, you enjoy a range of advantages: increased affordability, lower maintenance and well-kept shared amenities. However, some matters require careful consideration before purchasing a unit title property.

What is a Unit Title Property?

A unit title property, commonly known as a strata title, allows you to own a specific part of a building, such as an apartment or a unit, while sharing ownership of common areas with other unit owners. These common areas can include lobbies, gardens, swimming pools, and other shared facilities.

Body Corporate

A body corporate is the collective group of all owners in the unit title complex.  When you purchase a unit title property, you automatically become a member of the body corporate, which is responsible for the management and maintenance of the development, common areas and its facilities.

Each unit title complex will be subject to a set of body corporate rules that regulate the use of the development. These rules can cover everything from noise restrictions to pet ownership, so you must familiarise yourself with them.

Unit Titles Act 2010

The Unit Titles Act 2010 governs the ownership and management of unit title properties. It outlines the rights and responsibilities of all owners in the unit title complex and the body corporate. This Act has been amended several times, including substantial amendments passed in 2022 and 2024. The 2024 amendments attempt to provide more transparency and strengthen the rules surrounding the duties and expectations of body corporates.

Pre-Contract Disclosure Statement

Before signing a sale and purchase agreement, the seller must provide you with a pre-contract disclosure statement. This document includes important information about the unit, such as:

- Details of the unit and common property;

- The body corporate’s operational rules;

- The amount of the current body corporate levy; and

- Any ongoing maintenance or financial plans.

Pre-Settlement Disclosure Statement

Before settlement, the seller must provide you with a pre-settlement disclosure statement.  This document will record any changes since the pre-contract disclosure statement.

Long-Term Maintenance Plan

A body corporate is required to have a long-term maintenance plan. This outlines the maintenance and repairs needed for the common areas over at least a ten-year period.

Financial Considerations

When purchasing a unit title property, be aware of the following financial aspects:

- Body Corporate Levies: Regular fees paid by unit owners to cover the costs of maintaining and managing common areas.

- Special Levies: Additional fees that may be imposed for unexpected repairs or improvements.

- Insurance: The body corporate arranges insurance for the building and common areas. You will need to ensure that you have adequate contents insurance for your individual unit.

Key Takeaways

- Engage the professionals: Seek out a real estate agent who is experienced with unit title properties and engage with us before entering into a sale and purchase agreement;

- Understand the rules: Familiarise yourself with the body corporate rules; and

- Plan for costs: Be aware of body corporate levies and potential special levies.

Purchasing a unit title property can be a rewarding investment, offering community living and shared amenities. However, it’s crucial to understand the legal framework and responsibilities that come with owning this kind of property. By carrying out thorough due diligence and seeking professional advice, you will be able to navigate the process confidently and make an informed decision.

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