Doing your due diligence

In New Zealand, there are a few different types of property ownership that home buyers should be aware of. The type of property ownership can impact what you can and can’t do with the space in the future. The ownership type is outlined on the property’s certificate of title, which may list additional restrictions on what you can do with the property.

Freehold

This is the most common type of ownership in New Zealand, also referred to as ‘fee simple’. With this type of property ownership, you own the land and the buildings on the land. As above, there may still be some restrictions on the title that limit what you can do with the land, so it’s important to consider having the title checked by your lawyer.

Unit Title Ownership

Common in multi-unit properties like apartment blocks and town housing complexes, a unit title owner will own a specific part of a property - like an apartment, unit or even a car park!As a unit title owner, you will be required to join a body corporate which is essentially a collective of unit owners who make decisions about the shared building space. You may also be required to contribute financially to the overall building maintenance and pay other body corporate levies.

A builder’s report will usually identify any damage to the structure of the building as well as any maintenance issues such as mould or peeling paint. If there are big issues with the property, it’s better to know early on, so you can decide to cover the costs of repair or continue looking elsewhere.

Getting a pre-purchase builder’s report from a qualified building inspector in NZ means any potential issues could be identified before it’s too late. It’s a good idea to get a builder’s report prior to making an offer, or you might want to make it a condition of your offer, so you can keep the process moving without being locked into the purchase.

Here are some other important factors to check to help make sure the home you buy is in tip-top condition.

• Leaky home check
  When organising the builder’s report, you could check that the inspection covers any signs of the property being a leaky home. You could also have your lawyer or building inspector check if there has been a previous leaky home claim on the property.
• Asbestos & methamphetamine contamination
  Some older New Zealand homes do have issues with asbestos. Ensure this is checked for in the building inspection and that if so, you get an idea of the asbestos removal cost. Checking for previous drug use or production in the home is also important as this is a significant health hazard. Methamphetamine contamination testing can ensure the property is free from any traces of methamphetamine.

The LIM report is a helpful document to obtain from the local council. It contains important information that the council has on file about the property, such as any unique land features, storm water and drainage plans, natural hazard risks, zoning information, rates owing on the land, and building compliance information. You can request a copy of this report from the council for a fee, or ask if the real estate agent already has one on hand.

Home Insurance will usually be required as part of obtaining a home loan. We offer home insurance with a range of benefits, making it super-easy to streamline your finances. Check out our home insurance page for more information.

Whether you have just started house hunting or have found the perfect place for you, we can help with our simple mortgage pre-approval process. Learn more about conditional approval and how it can speed up your first home journey today.