Other Types of Property

Other Types of Property

  • Apartments
  • Investment properties
  • Baches, cribs and holiday homes
  • Lifestyle blocks
  • Timeshares
  • Retirement villages
  • Overseas property investments


Unit title: The usual method of apartment ownership is a unit title.

Under a unit title scheme, all the owners comprise a body corporate which is responsible for maintaining the fabric and structure of the building and the grounds, as well as insurance. In addition to the usual outgoings for apartment living, you will also need to take into account any extra costs levied by the body corporate.

Depending on the size of the building, its construction and location, the body corporate levy could also include payment for garden maintenance, a building manager, a body corporate secretary and
lift maintenance.

You should take particular note of the body corporate rules which set out the way in which it is run. Some rules are easily altered, others are not. There may be special rules relating to tennis courts, swimming pools, the barbeque area and any social clubs. Rules about pet ownership are usually particularly clear. For example, a budgie may be fine but a large dog may not be acceptable.

Apartments that are within a hotel complex have very particular rules and specific issues to consider.
The rules may set out how you live your life, and this may not suit your lifestyle.

If you are buying the apartment as an investment, you must ensure it can be let. Often specific rules apply to tenancies and it pays to check these before you decide to buy.


Buying off the plans: If the building is still only a set of plans, there are many issues (for example, taxation implications) to be taken into account before finally committing to a purchase. You should check whether any other buildings are being constructed nearby (or are on the drawing board) that may
obstruct sunlight or views. Inner city apartments can be noisy from traffic, restaurants, late night revellers, railway lines, etc.

Special arrangements will need to apply to your deposit so it is not lost if the development does not proceed.

Flat owning companies: Whilst apartments are usually owned on a unit title, some ‘flat owning companies’ still exist. In this situation you buy shares in the company which owns the building. There are some issues with the saleability of an apartment which is held in this type of ownership. For example each purchaser must have the existing owners’ consent to be ‘let in’. This can sometimes reduce the pool of possible purchasers and, of course, the price.

Investment properties

Owning an investment property can be a very worthwhile endeavour.  The return on the investment may be greatly enhanced if the ownership structure is considered at the time of purchase. The property can, of course, be purchased personally. Alternatively you can buy the property through a Loss Attributable Qualifying Company (LAQC) or you may prefer to form a new family trust. Do talk with us early on so we can talk about the best ownership method for your particular situation.

During the purchase negotiations, careful thought should be given to the valuation of the chattels. The contract will need a special clause if depreciation is to be maximised.

You should also factor into your calculations the time taken to get new tenants and also the cost and time taken to fix any deferred maintenance.

Any investor in residential property should be familiar with the Residential Tenancies Act 1986 (currently under review), the scope and powers of the Tenancy Tribunal and tenants’ rights. Particular rules apply to bonds and tenancy agreements.

At the time of going to press, the government is debating a possible capital gains tax. Buyers should be aware of the implications that such a proposed tax may impose on an investment property purchase and/or existing property investments.

Selling an investment property: When selling you will need to take into account ‘recovered depreciation’ when setting your price, particularly for chattels. There could be serious tax consequences if this is not
done correctly.


Tax: Specific tax issues need to be addressed when buying or selling investment properties. Your choice of buyer (ie: yourself, a company or trust) is just one of these. We can advise you on the most advantageous structure to adopt. It is extremely important to talk with us BEFORE signing the Agreement so any taxation advantages can be taken into account.

Baches, cribs and holiday homes

Sometimes baches, cribs and holiday homes are acquired for reasons other than their holiday value; holiday homes can play a specific role in retirement or investment planning.

The ownership structure for second homes should therefore be carefully considered. There may also be an opportunity to minimise tax; we can talk with you on specialist tax advice.

As the property is likely to be empty for much of the year, your insurance company must be notified of this. You may need to invest in a burglar alarm and/or special locks or shutters to help keep it secure.

Lifestyle blocks

There is more to this than deciding whether or not you may need a ride-on mower!

Bare blocks: You will need to ascertain if there is a suitable building platform for placing a house. Some titles have restrictions pointing out foundation difficulties, but others may not. Check with the local authority before you buy.

Water supply (for the house and possible irrigation requirements), drainage and septic tank requirements and regulations, as well as electricity supply and telephone lines should all be checked.

Access can be an issue on bare blocks. Many blocks have a lengthy right-of-way or shared road; some of these may not be formed at the time of purchase and could be expensive to construct.

Income-generating blocks: Those life-stylers who want to make a living from the block will need to consider the economic viability of the land and soil tests may be needed. Talk with us if you would like some help with ascertaining the economic viability of your plans.

Buyers may want to consider obtaining a Land Information Report (LIR) from the local authority. The LIR gives details relating to the physical and natural resources of the property and may cover issues relating to flooding, contamination and water.

GST: Prospective buyers should be aware that there could be GST payable when buying a lifestyle block.


Non-residents: Please note that if you are not a New Zealand resident then any purchase of land over five hectares is subject to your obtaining approval with the Overseas Investment Office. As this can be a lengthy process you will need to contact us before signing any Agreement for Sale & Purchase to ensure this issue is properly covered.


There has been a proliferation of timeshare apartments and resorts developed in New Zealand in the last 25 years or so. In most respects buying a timeshare is very similar to any other property purchase,
however there are some differences.

Most timeshare properties in New Zealand have been set up using the body corporate structure accompanied by registered leases of every unit for each timeshare week. The registered proprietor of a timeshare title receives a share of the strata title and the lease of a unit for their timeshare week. You should obtain advice from the timeshare sellers and the body corporate or operator on pooling agreement administration where a timeshare is part of a holiday resort.

Retirement villages

The physical security and wide range of activities offered by retirement villages are of major appeal to prospective residents. Retirement villages must operate within the Retirement Villages Act 2003 and its
amendments, including the Code of Residents' Rights.

If you are considering living in a retirement village, do talk with us early on as we can advise on the unique nature of buying into this type of development. Issues to be considered before proceeding will depend on whether the village is already established, or merely a set of plans.

Before committing yourself to buy a unit, you should be aware of the nature of the occupation right offered in a retirement village. Most retirement villages do not offer readily transferable titles. The interest that is acquired by a buyer is generally a ‘licence to occupy’. This is similar to a lease that gives the resident the right to occupy a unit, but there are no rights over the land. In general, the occupation right is not able to be sold or otherwise disposed of other than through the retirement village proprietor.

Some villages have titles with a life interest, with a mortgage back to the buyer to secure the licence to occupy.


Most retirement villages require an up-to-date prospectus to be available to prospective buyers.
Read it carefully and do hand it over to us for a close inspection so we can advise on the special nature
of this type of purchase.

Of particular importance is the method of sale of the unit and reimbursement of capital when the time comes to sell your unit. Talk with the retirement village proprietor about this. The village will usually not pay you out until there is a buyer for your unit and there can be considerable delays in the reimbursement of capital. You should also investigate what is involved in moving from a unit into the hospital section of the retirement village (if there is one),and also the weekly or monthly service charges.

Moving into a retirement village can be of huge benefit to the elderly, and also to their families. Make sure you have done thorough research and remember to talk with us well before proceeding with a purchase.

Overseas property investments

New Zealanders buying overseas: If you are a New Zealander considering buying property offshore you will need to be very cautious about the type of property being offered . Do your research first, and
then talk with us before taking the prospective purchase any further. Be wary of free trips ‘without obligation’ and high pressure sales people. Offers of ‘guaranteed returns’ should be viewed with caution.

Remember, if it sounds too good to be true, it usually is.

Non-residents buying New Zealand property: If you are neither a New Zealand citizen, nor ordinarily resident in New Zealand, you may need to apply to the Overseas Investment Office (OIO) for
consent to buy:

  • Non-urban land over five hectares, and/or
  • ‘Sensitive land’ or land adjoining sensitive land such as beach or lakefront.

The Overseas Investment Act 2005 states how the rules apply. However, check with us first as to the application of the rules.

DO NOT sign any documents until you have talked with us.



Please contact Tina McLennan, Anna Ferguson or Jo McLennan for more information.