A vendor in Mt Eden had a signed sale and purchase agreement. The buyer was pre-approved, the price was agreed, and the settlement date was six weeks away. Two weeks before settlement, the vendor's solicitor issued the pre-settlement disclosure statement. The buyer's solicitor noticed that the long-term maintenance fund showed $22,000 — but a special levy of $18,500 had been approved at a body corporate meeting three weeks earlier, drawn from that fund for emergency roofing work. The pre-contract disclosure statement had shown a fund balance of $40,500. The buyer attempted to cancel. Four weeks and two lawyers later, the parties settled on a $9,000 price adjustment.
Selling a unit title property is more administratively complex than selling a standalone house, and the disclosure obligations on sellers are the main reason. Getting them right isn't optional — an incomplete or inaccurate disclosure statement can give a buyer the right to cancel the sale, delay settlement, or renegotiate the price, none of which you want six weeks before you're supposed to be handing over the keys.
Your obligations as a seller: you must provide a pre-contract disclosure statement before the buyer signs the sale and purchase agreement, and a pre-settlement disclosure statement at least five working days before settlement. Both documents have prescribed content requirements under the Unit Titles Act. Both must be accurate at the time they are provided.
The PCDS is the heavier document. It needs to include the body corporate's financial position, levy amounts and utility interest, the current LTM plan and LTM fund balance, any legal proceedings the body corporate is involved in, maintenance history and planned work, and governance information. If any of this information changes materially between the PCDS and settlement, it needs to be captured in the PSDS.
The five things most likely to cause a buyer to cancel or renegotiate: an LTM fund with $0 or a very low balance relative to the LTM plan's requirements; outstanding levies or levy debt owed by the unit being sold; pending or unresolved legal proceedings involving the body corporate; a recent special levy that wasn't disclosed in the PCDS; and a significant change in the maintenance picture between signing and settlement.
Preparation is the answer to most of these. If you're thinking about selling, ask your body corporate manager for a pre-sale disclosure audit 60 to 90 days before you list. This gives you enough time to address issues before they become problems — to check that the LTM fund balance is accurately documented, that there are no outstanding levies on your unit, that any planned maintenance has been properly recorded. A buyer who can see clean, current documentation is a more confident buyer.
One thing sellers sometimes try: delaying the PCDS until after the buyer has made a verbal commitment, to avoid the buyer having time to scrutinise it. This is both legally risky and counterproductive. A buyer who feels they were pressured through the disclosure process is more likely to find problems later — and more motivated to use their rights when they do. Proactive, transparent disclosure produces better outcomes for everyone.
The broader point for sellers: the quality of your body corporate's management directly affects how smoothly your sale goes. A building with current financial statements, a funded LTM plan, clear governance records and a manager who can produce an accurate PCDS quickly is a building where sales complete without drama. A building that is poorly managed in any of those areas creates the conditions for exactly the kind of situation that cost the Mt Eden vendor four weeks and $9,000.
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.