- Lorraine Burns
The 3rd biggest mistake you can make when buying a house in New Zealand
Buying a home with unconsented alterations and additions.
The kiwi can do attitude leads to many homeowners undertaking work on their properties themselves such as installing insulation, building a deck or renovating a kitchen without realising that they need to obtain Council consent to do this work before they start, and have it approved (signed off) once completed.
Unconsented works can cause major problems for buyers. You can find it very difficult to obtain finance and insurance for a property that has unconsented works. Banks and insurers are concerned about the potential safety issues that could arise, as well as the unknown future costs and consequences of the unconsented works. For example, if an unconsented wood burner causes your house to burn down, then your insurance policy won’t cover you. You would need to recover your losses from the previous owner who arranged the unconsented wood burner to be installed.
In the Agreement for Sale and Purchase of a property, the seller provides a warranty to the buyer that they have obtained the permits and consents required by law, and complied with those in completing works on the property. However, the Sellers lawyer or real estate agent may insert clauses in the Agreement for Sale and Purchase of a property to limit liability and compensation for specific unconsented works.
This is not ideal as the council may then issue you with a ‘notice to fix’ which would require you to put the property back to the way that it was before the work was done, or require that a ‘certificate of acceptance’ be obtained, which is yet another cost.
Council can also insist that the remedial work meet the current Building Code and not the rules that applied at the time the unconsented work was done.
To avoid the cost of repair or problems with insurers and banks it is best to insist that the seller obtain certification that the unconsented work was compliant, at their cost. This includes any changes the seller might have to make to the work already done to bring it up to the Building Code. Alternatively, the price can be negotiated significantly where there is non-compliant work.
Detecting unconsented work is much more difficult than simply identifying consents not completed. When you engage the Exclusive Buyers Agency we will thoroughly review the LIM (Land Information Memorandum) and the Council files for the property. We will compare the most recent recorded layout of the property with what was viewed to identify whether unconsented work has been undertaken.
Exclusive Buyers Agency will never try to sell you a home. We provide you with all the information (good and bad) to enable you to make an informed buying decision.
When you need experts, who are on your side and committed to helping you get what you want call me directly on +64 21 468 828.
Discover the 4th biggest mistake you can make when buying a house in New Zealand.
Lorraine Burns
Licensed Buyers Agent (REAA 2008)
Managing Director & Buyers Agent
Exclusive Buyers Agency Ltd
Mobile +64 21 468828
DISCLAIMER: The information contained is not intended to form professional legal advice or legal opinion on any particular matter. The opinions expressed in the material are not necessarily those of IFPNZ Ltd (Licensed REAA 2008). IFPNZ Ltd and Exclusive Buyers Agency Ltd make no representation or warranty as to the accuracy or completeness of the material. Exclusive Buyers Agency Ltd & IFPNZ Ltd accepts no liability for any loss, damage or consequence, resulting directly or indirectly from the use of the material.