Preparing for a sale


Farmer Freddy was enjoying his coffee and toast after a busy morning on the farm when Pebbles popped by for a quick chat.

"Dad, I read somewhere recently that there are new rules that apply to some timeshares and apartments. Are you still planning on selling your timeshare in Taupo?"

"In actual fact," replies Freddy, "I had a message from the agent the other day and I must get back to him. I'm still planning on selling, but I have decided to hold off marketing the property until the spring."

"Well," explains Pebbles, "the new Unit Titles Act 2010 came into force on June 20, 2011 and provides for a new disclosure regime."

"Is my timeshare covered by the new act?" asks Freddy.

"Yes," answers Pebbles. "Your timeshare is a unit titled property, which is a common form of multi-unit property ownership whereby you privately own part of the apartment building and a share of the common property with the other unit owners.

"Dad, you need to be very careful about providing the right information to a prospective purchaser before he or she signs an agreement.

"First," Pebbles explains, "the new act says that you must give a pre-contract disclosure statement to a buyer before any agreement is entered into. The form of statement is prescribed by the act, and contains information relating to unit titles and how they work, specific information relating to your unit, such as weather-tightness issues, levies, insurance details, litigation etc, and the cost of providing an additional disclosure statement."

"So, Pebbles, who is responsible for preparing the pre-contract disclosure statement?" asks Freddy.

"Well," she explains, "ultimately, it is your responsibility. However, either your agent or your lawyer will be able to help you pull together all of the necessary information and complete the pre-contract disclosure statement."

"Gosh," says Freddy, "I guess I had better start thinking about this well before spring, when I'm busy with the calves. It sounds as though there is a bit of work to be done before an agreement can even be signed."

"That's right Dad," says Pebbles. "And, by the way, if you don't provide the purchaser with the pre-contract disclosure statement, you might end up in the Tenancy Tribunal having to explain yourself, or the purchaser may even cancel the agreement."

"Thanks, Pebbles. I think I'll call the agent once I finish my coffee and get him to get things under way."


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