If you are thinking of selling your home, do talk with us before contacting a real estate agent and placing your property on the market.
We will check that your property title is in good order and may advise you to fix any discrepancies or irregularities.
We can also talk with you about the pros and cons of selling through a real estate agency, or perhaps selling privately.
If you choose a real estate agency to handle the sale, we can discuss the currently accepted commission rate for real estate agents in the area. Commissions and advertising arrangements for properties are negotiable and may vary from agent to agent. As we deal with many property transactions, we are in a good position to ascertain trends in market expectations for commission, advertising arrangements and so on.
Before placing your property on the market, we recommend that you take care of some paperwork beforehand:
We recommend that you obtain your property’s Land Information (LIM) Report before placing your property on the market. The LIM Report is held by the local authority, to whom you will need to pay a fee.
The LIM Report gives information about plumbing, drainage and water reticulation plans, issued consents and permits, compliance schedules, licences, special site features, swimming pool fence regulations, unsatisfied requirements and many other details about your property.
The LIM Report will give a prospective buyer a lot of information about your property, and whether or not you (or earlier owners) have complied with the local authority’s requirements.
However, you need to consider what the LIM Report will disclose before placing your property on the market as there may be some problems of which you are unaware. If you wait for a potential purchaser to obtain the LIM Report and problems are discovered, you could be in for a nasty surprise.
Later on, when a prospective buyer is making an offer for your property they may wish to insert an extra clause into the Agreement making the purchase subject to their approval of the LIM Report.
Having a LIM Report available to any prospective buyers may circumvent having such a clause or speed up the decision time a buyer may need to make the purchase unconditional.
Special provisions apply if your property is a unit title. Before placing your unit title property on the market, you should have copies of all insurance policies or certificates effected by the body corporate, as well as a copy of the Section 36 certificate (a statement of the seller’s contributions and any liabilities) signed by the body corporate secretary.
A prospective buyer may ask to see these before they put in an offer. When your property sells, this paperwork will have to be delivered to the buyer at least five working days before settlement.
If these documents are not provided, settlement (but not possession) may be deferred which may lead to serious complications if you are buying another property.
We recommend that you shop around to find a real estate agent. Look around to see which agencies cover your area and which seem to have SOLD signs up quickly, look on the internet for properties for sale in your area and visit some open homes. This will help you get a feel for the market and for the real estate agencies operating in your area.
Get your shortlist of agencies down to two or three and ask them to look at your property. Each agency should be prepared to make a presentation to you on why they should be selected to act for you.
They will give you an idea of price expectations and they should have prepared a preliminary marketing plan for your property. They should also let you know what costs will be incurred to help sell your property; this will include newspaper advertising, photographs, internet listings, signage and so on. All these costs will (usually) be additional to the commission you will be paying the agent.
Most importantly you also want to make sure that you and the real estate agent feel at ease with one another. Selling a property can be a very stressful and emotional time and the whole process is much
easier if you and the agent can work comfortably together.
You will need to decide whether to appoint a sole agent, or to have a general listing with two or more real estate agents. There are pros and cons for both, and we can help you make this decision.
Once you have decided on a real estate agent to act for you, you need to sign an agency agreement. Read it over carefully before signing and do not hesitate to ask any questions if you are unclear on anything. Alternatively, we would be happy to review it for you.
There are a number of ways of selling a house:
Your real estate agent will be able to tell you about the processes of each method of sale and what may be appropriate for your particular property and the area in which you live. We can also talk with you about the legal implications of whichever sale method you choose.
Your real estate agent will guide you on the best asking price, the price guide or the auction reserve for your house. This will be based on the Rating Valuation and the recent sale prices of properties in your area. The price will also include some chattels such as carpets, curtains, blinds, stove and other items.
If your property has special features (such as garages on a road reserve or tunnel houses), or you simply do not agree with the figures supplied to you, it may be worthwhile getting a private valuation before agreeing to a sale price or range.
In 2009 changes were made to the Agreement for Sale & Purchase.
The Auckland District Law Society (ADLS) updated its existing Agreement form, and the Real Estate Institute of New Zealand (REINZ) introduced its own new Agreement.
However, there is now some discussion between ADLS and REINZ with a view to amalgamating the best aspects of each form into one new Agreement document.
We have our own views on both these forms, and believe it is imperative you discuss this with us, before you sign the Agreement, which of these two Agreement forms should be used for your property.
The Agreement form is designed for you and your real estate agent to ‘fill in the gaps’. However, a number of other clauses may need to be inserted or deleted.
You will also need to decide which chattels are to be sold with the house as these have to be listed individually in the Agreement.
Do talk with us if you have anything you would like clarified, or need some advice.
When an offer is presented to you by a prospective buyer, do talk with us BEFORE you sign the Sale Agreement. It should already be signed by the prospective buyers.
If there are too many conditions its effect could be simply to give the buyer an option to buy your property, rather than a firm sale, which could be disadvantageous to you.
An offer may be unconditional, or it may be conditional on the sale of the prospective buyer’s own home, or confirming finance, or it may contain other conditions.
All people who are listed on the title as owning the house will need to sign as sellers if the offer is counter-signed or the offer is accepted. This means that if your property is owned by a trust, all trustees must sign.
Please note that if one of the sellers is away or unable to sign, we will arrange for a Power of Attorney to be prepared which gives necessary authority to someone who can sign. Alternatively, arrangements can be made for signing by fax or a scan if the Agreement makes provision for signing in this manner.
Once the prospective buyer’s offer is accepted and both parties have signed the Agreement and initialled all the changes, you are both bound by its conditions. The deposit will be called for, and any
conditions will need to be fulfilled within the agreed time limits so settlement can proceed.
The Agreement states that you will make available for the buyer all keys for exterior doors, electronic door openers and the alarm codes (unless the property is tenanted). These must all be available on settlement day.
If you have lent a key to anyone, you will need to get it back in time for settlement.
When you sell one property, you are usually buying another and will move into your new property on the day you leave your old house. It is probably best for both properties to be settled on the same day and for the respective conditions of both Agreements to operate contemporaneously.
We will prepare a settlement statement showing the buyer the amount to be paid on settlement day. A discharge of any mortgage or other debt shown against the title will be arranged and you can expect to
have to sign a transfer authority about a week before settlement day.
From the proceeds of sale, and immediately after settlement, we will organise the repayment of any
mortgages so that clear title is given to your buyer.
Rates and other outgoings such as body corporate payments will be apportioned to the settlement date. The buyer’s lawyer will probably require us to personally guarantee that the rates are paid, the water meter has been read at the settlement date and the water account paid. We will organise payment of these and account to you for the sale proceeds. Some lawyers will withhold a sum to cover these until the water account comes in a few days after settlement.
All law firms now register land transactions electronically.
This is carried out by Land Information New Zealand (LINZ). Early on in the settlement process we will ask you to sign documents authorising electronic registration and we are required to see government-issued photographic proof of your identity. A current driver’s licence or a passport are the main options: if these are not available you will need to talk with us regarding alternative identification requirements (such as a firearms licence).