Buying a House in New Zealand
Buying a house is probably the biggest financial investment you’ll ever make, and while it’s exciting and full of promise, it can also be an overwhelming experience, with hidden pitfalls and costs causing significant stress.
How to buy a house in NZ
The different ways that you can buy a property in New Zealand include by auction, by tender or at an advertised price.
If you have an existing property that you need to sell first, an accurate evaluation is essential to know what it’s worth. Most reputable estate agents offer a free property appraisal service.
Know what you can spend
Understand your finances and know how much equity you have in your current property (if you have one), and speak to NZCU South for further help on mapping out a reasonable and achievable budget.
Get a pre-approved home loan
Having your mortgage approved before you begin your search empowers you with more choice when it comes to selecting the home that’s right for you. Apply for a loan online, or call us on 0800 86 56 36.
Whether you’re buying your first home, or if you have a home loan already and are refinancing, we can offer you a home loan to cover your every requirement.
Once you have preapproved home loan you’re in a better position to negotiate. It speeds up the mortgage documentation process, and means you can go into a house auction with confidence. The amount you are able to borrow will depend on:
- The value of the house you’d like to buy
- The amount you’re able to put down as a deposit
- What you earn
- Your ability to meet repayments once all your outgoing commitments have been met
- Any equity you may have (e.g. an existing property you own).
Find the home that’s right for you
There are many ways to find the right house for you, and everyone has their preference. Options include:
- Online, using various websites
- App (utilising a phone or other mobile device)
- Agency salesperson
Things to look for when buying a house
- Inspect the property thoroughly, remember it can help to see it both during the day and at night.
- Check the piles/foundations don’t give you a sense of sloping
- Check the wiring – is it the old fashioned variety that will need replacing soon?
- Check the exterior for flaking or peeling or rotten weatherboards
- Does the roof have lichen, moss or plants growing on it, and are there any loose tiles?
- Turn on a couple of taps and flush the toilet – are there any noises? What’s the pressure like?
- Is the house heated? Is it heated with electricity or gas?
- How is the house oriented for sun? Are there surrounding hills, buildings or trees that will cast a shadow over the house?
Hire the services of a solicitor
We strongly recommend you obtain independent legal advice before you purchase your house. Your lawyer will review all the property reports, e.g. LIM reports, and will ensure all required legal processes are followed. He or she will also do a title check, which establishes:
- Who the legal owner is
- The type of title (such as freehold, leasehold, cross lease etc.)
- Covenants or ease of ways
- Any existing mortgages on the property
Once this is all done, it’s time to make an offer. All offers must be in writing, and must be submitted using the correct documentation. The two types of offers are:
- A conditional offer (where your purchase is dependent on certain criteria, such as a satisfactory building report outcome)
- An unconditional offer.
Your offer is accepted when all parties agree to the terms, price and deposit, and an agreement contract has been signed by all parties.
If the purchase is conditional, the conditions must be met by the due date. It is the responsibility of the buyer to satisfy the stipulated conditions.
With an unconditional agreement, neither the seller nor the buyer can change their mind, and the buyer is obliged to pay the full purchase price by settlement day.
Settlement day is when you pay the outstanding balance on the property, and is usually the same day as you get the keys. If there are a series of settlements that need to happen before your house purchase can go through, access to the property may be delayed slightly.
Congratulations on your new home!
If we can help you with a pre-approved home loan, get in touch right away – by filling out an online application or contacting us on 0800 85 56 36.