Whether you currently reside in New Zealand, you’re thinking of relocating there or you just want to benefit from the rises in the market prices of real estate, we can show you how.
And if you’re wondering whether now is the right time to enter the property market as an investor, the National President of the Real Estate Institute of New Zealand claims that Spring time (October 2004) has brought about increased sales and a new record national median selling price - in fact, the projected falls in the market are seemingly just not forthcoming.
So, how do you go about securing and purchasing your dream home in New Zealand?
The first thing to note is that the entire process is generally quick and easy, especially if you compare it to the major European countries - U.K., France, Germany, Spain etc., all have far more complicated and expensive buying procedures in place.
The initial step will be choosing your dream property.
Many real estate agents advertise on the internet - and in the major newspapers in New Zealand of course. Select a few properties that you like the look of, contact the relevant agents and get them to arrange viewings for you and to forward you the details of similar properties.
If you are purchasing from overseas and you have someone on the ground you trust then it will be necessary for them to arrange any viewings at their convenience.
An alternative is to appoint a ‘buyer’s agent’ - many of the major estate agencies now offer this service as part of their package. Such an agent acts on your behalf to source and inspect properties that meet your requirements. Usually this is a value added service at no extra cost - but do make sure you check before engaging the services of such an agent in case they do actually charge.
If you’re viewing properties yourself try and have your agent arrange times when the vendor is actually away from the house - at least for the first inspection.
That way you’ll have a chance for a good nosey and you can make sure that you’re comfortable with what it is that you may be purchasing.
Some people will disagree with me on this point, saying that it is beneficial to have the vendor on site to answer any questions that you may have regarding the property, its location, proximity to local facilities etc. My answer would be
a) a good agent should be able to cover most of these points with you
and
b) a second viewing when the vendor is in situ can cover this ground as well!
Before I continue, if you are interested in becoming a property investor in New Zealand the following resource might give you the further targeted information that you require: -
The Complete Guide to Residential Property Investment in New Zealand
Lisa Dudson
A typical reader review: -
“Practical experience is what makes the difference in this game and this book gives you a plethora of practical tips & advice, including tables with different outcomes of common decisions.
“How to deal with real estate agents” is a particularly helpful chapter; remember they are working for you - not vice versa. Dudson also recommend other books, websites, software & information sources investors can use.
Property can be a truly sound investment, and if the research & preparation is done, as the authors of the book illustrate, the bottom line can be drastically improved.”
Click here to order a copy directly from Amazon!
This will open a new browser window - if you have a pop up blocker you will need to hold down the control key and then click the link!
If the property you’re interested in is to be sold under ‘private treaty’ then the process is as follows: -
Offers for the sale and purchase are required in writing.
Any offer you wish to submit should be discussed with and then drawn up by your estate agent.
They then present the written, formal offer to the vendor.
Make sure the following are also submitted with your offer: -
A provision for you to have a lawyer complete title searches and check the validity of all the other associated legal documents.
A provision for you to have time to arrange a mortgage for the purchase if necessary.
A provision for valuation and building inspection reports to be completed for your acceptance.
Depending on how long all of the above are expected to take you are required to state your preferred possession date, and of course your offer price.
This offer submission is not necessarily final - it is not a closed bid situation - in fact negotiations can continue until all parties involved in the process reach agreement.
If your offer is accepted then it becomes a “conditional offer” - conditional until all your provisions as detailed above have been completed and accepted by you.
As soon as that stage is reached the offer becomes “unconditional” and the property is about to become yours - upon payment of a deposit and then the final agreed amount of course!
It’s usual to have to pay a 10% deposit at the point the offer becomes unconditional.
The final balance is due upon the completion date - a date agreed by both parties - this is usually a couple of weeks after an offer becomes unconditional and it is normal to expect to take possession of your new home a month after the unconditional stage is reached.
If you’re interested in a house that’s going to auction the process is as follows: -
Firstly you need to make sure that you’ve done all your homework in terms of viewings and necessary research into the property before you begin bidding!
Secondly if you bid, understand that you’re bidding on a “cash and unconditional” basis - i.e., you have to have all your finances arranged because if the hammer falls on your bid the house is sold to you and you cannot change your mind!
If you’re not able to physically attend the auction or you would prefer not to have to do your own bidding it is possible to appoint someone you trust to bid for you. Just make sure they are 100% certain how high you’re willing to go!
When it comes to auction property you’ll generally find that they come on to the market with a three to four week window before the actual auction date.
This allows prospective buyers adequate time for: -
Inspections
Surveys
Valuation reports
Arranging any necessary finance etc., and these inspections and reports are usually at the expense of the purchaser.
All legal documents relating to the title etc., are provided to the purchaser free of charge by the owner - a benefit of purchasing at auction.
Extra fees you should always expect to have to pay include building and structural surveys and all valuations - each costing about 500 New Zealand dollars (NZD) and legal fees of around 1500 NZD - which will include tax at 12.5%.
Of course fees will vary depending on the complexity of the situation and bear in mind that everyone’s circumstances are unique!
