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A guide for buying a house, from choosing a lawyer to making an offer on a house and signing the sale and purchase agreement.
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choosing a lawyer
offer and negotiation process
setting conditions
sale and purchase agreement
going unconditional
shared ownership
completing settlement
after settlement |
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| It’s a good idea to choose a lawyer before you want to make an offer on a house. Your lawyer’s job is to |
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check contracts |
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explain your rights |
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do the legal paperwork |
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ensure everything to do with ownership is in order |
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| Most houses are sold by the offer and negotiation process. This is normally done through a real estate agent using a sale and purchase agreement. Get your lawyer to check this agreement before you sign it. |
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| The written offer passes between you and the seller until agreement is reached or one of you decides to stop the purchase process. |
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| Your offer will have several dates in it including |
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finance date—normally five business days from offer date |
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settlement date—the day you take ownership of the house |
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| You can make your offer subject to conditions. This gives you time to check the house and negotiate if needed. |
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| Conditions you should consider include |
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subject to finance—gives you time to confirm and arrange your finance |
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subject to title search—check for title problems, restrictions, covenants or easements |
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valuation report, building report or engineering report |
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| If your offer is unconditional, you have to go through with the deal if it is accepted. You must be absolutely sure you have the finance and that you want to buy the house. |
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| The sale and purchase agreement is binding once you and the house seller have signed the offer and initialled any changes. |
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| You will need to pay a deposit—usually 5 to 10% of the sale price. The rest is paid on the settlement day. |
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download the NZ Residential Property Sale and Purchase Agreements Guide.
(PDF 184kb) |
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| After your offer has been accepted, your lawyer will search the property title and check there is nothing that could affect your decision to purchase. |
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| Once these checks and all ‘subject to’ conditions in your offer are met, your lawyer will advise the seller’s lawyer that the sale is unconditional. You are now committed to the sale. |
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| Your lawyer will then |
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prepare and explain your mortgage documents |
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prepare the Memorandum of Transfer—this transfers ownership to you |
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check rates and other costs are paid |
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check you have insurance for your new house from settlement date |
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carry out a guaranteed search of title—this protects you from any claims over your property for two weeks before and six weeks after settlement |
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arrange with the bank for payment of your loan and outstanding purchase price |
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| If you are buying a house with someone else, your lawyer will advise you of the best way to set up shared ownership. |
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| The two main ways to own a home together are |
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you own the home together |
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if one of you dies, ownership is passed to the other person |
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this is common with couples |
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you each own a share of the home |
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you can leave your share to anyone you choose in your will |
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this is common where there are several owners of a property |
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| Settlement day is the final stage of a property sale. You take possession of the house on this day and your name and mortgage go on the property title. |
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| On settlement day your lawyer will |
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get the property title from the seller’s lawyer |
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sort out legal papers relating to the house sale |
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pay the balance of the purchase price to the house seller’s lawyer |
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| Shortly after settlement your lawyer will |
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give you a new settlement statement with all the purchase details |
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register your mortgage and the property title transfer with the Land Information Office |
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give you a copy of the property title showing you as the new registered owner |
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send the property title, mortgage and insurance certificate to your mortgage lender to be held as loan security |
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