Sarah had been hunting for an apartment in Grey Lynn for almost two years. When the right one came up she moved fast — offer in by Thursday, signed by Friday. The pre-contract disclosure statement arrived the same afternoon as the sale and purchase agreement. She skimmed it on her phone. Three weeks later her solicitor called: the unit carried $24,800 in unpaid levies run up by the previous owner — and under the Unit Titles Act, unpaid levies can be recovered from whoever owns the unit when recovery proceedings begin. The debt had, effectively, come with the keys.
The pre-contract disclosure statement — PCDS, if you want to sound like you know what you're talking about — exists to stop exactly this. Before you sign a sale and purchase agreement on a unit title property (apartments, townhouses, most modern terrace developments), the seller must give you one. Not after you have signed. Not on the same day buried in an email chain. Before.
What has to be in it? The body corporate finances: current levy amount, outstanding debts owed to or by the BC, and the state of the long-term maintenance fund. The maintenance picture: what has been done recently and what is planned. Any legal proceedings involving the body corporate — Tenancy Tribunal cases included, which are more common than most buyers realise. And governance information, which is essentially a check that the body corporate is being run legally.
Most buyers do what Sarah did: scan the levy amount, glance at the insurance section, and move on. The parts worth slowing down on are the ones where problems like to hide. A long-term maintenance fund balance of $0 isn't a rounding error — it means there is no money set aside for future repairs. Missing financial statements mean someone isn't keeping proper records. Anything in the remediation or legal proceedings section is worth reading twice, because that is where expensive unresolved problems tend to sit quietly.
There are a few red flags that should make you pause. A PCDS that arrives late — after you have already signed — means the seller hasn't met their legal obligation and you may have remedies. One that is visibly incomplete, relies on old figures, or can't be produced within a day or two tells you something about how the building is being managed. And anything vague in the 'pending work' section deserves a direct question to the seller's agent.
If the disclosure statement turns out to be wrong, or if you never received one before signing, you have legal options. A buyer who never got a PCDS can cancel the agreement. If the statement was incomplete or inaccurate, you may be able to delay settlement or — if the problem is significant and the seller doesn't put it right after you give written notice — cancel. Your solicitor needs to move on this quickly: the timeframes under the Unit Titles Act are specific and not particularly forgiving. 'I didn't read it carefully' is, unfortunately, not one of the valid grounds.
There is a second document to know about: the pre-settlement disclosure statement, which the seller provides closer to settlement. This one captures everything that changed after you signed — a new levy voted at an emergency meeting, maintenance work that started, a legal proceeding that got filed. If anything in it surprises you significantly, you may have rights there too, including delaying settlement until five working days after the seller gives you a complete and accurate statement.
Getting your own solicitor to review the PCDS before you sign isn't overkill. You're buying into a shared governance structure with financial obligations and legal exposure that transfers to you on settlement day. The PCDS is your window into what you're actually buying into. A well-run building makes that window clear. A poorly managed one tends to be a bit foggy — and that fog is usually trying to tell you something.
Quarter is the new body corporate — transparent, owner-first, and built for the way people actually live together. See how it works at quarter.nz.