Selling property during COVID-19 alert level 3
Sellers | 28 August 2020
By The team at settled.govt.nz
This page explains some of your options if you’re buying or thinking about buying during COVID-19 alert level 3.
New Zealand is in the middle of a unique situation, and it is likely to be a challenging time for everyone involved in selling and buying property. Be kind and consider the needs of others when you’re communicating about a transaction.
To see what alert level your region is at and for general information about the current COVID-19 situation, visit covid19.govt.nz
If you’re also selling property during alert level 3, there is more information here.
At alert level 3, it may be possible to meet your conditions because professionals such as valuers, property inspectors and engineers may visit a property if they cannot provide their service remotely, if it is safe to do so and if the property's occupants agree. They need to maintain a physical distance of 2 metres from anyone while they are there, and it is highly recommended that everyone wears a face covering. You can find guidance about face coverings on the COVID-19 website.
If you can't meet your conditions at alert level 3, talk to your lawyer or conveyancer, because the seller may agree to extend the conditional period.
If you’ve agreed with the seller that they need to get something fixed at the property before settlement, they can get a tradesperson to do that work at alert level 3.
If both parties agree, the conditional period can be extended, and/or the settlement date can be postponed, until your region or the seller’s region moves to alert level 1 or alert level 2.
Talk to your lawyer or conveyancer about the best approach for your transaction.
Many law firms and agents are working remotely, so there may be delays in service.
At alert level 3, you should use virtual methods to inspect a property where possible. Seek legal advice about the risks of a video inspection. This type of inspection may not pick up issues you would see if you were physically inspecting the house.
If a video inspection is not possible, with the seller’s consent, and the tenant’s consent if the property is tenanted, you can visit the property if the property is within your alert level 3 region. Up to two people from the same extended bubble can visit the property at one time, plus the real estate agent. You must comply with the health measures explained by the agent when you visit and maintain a physical distance of 2 metres from anyone outside your extended bubble while you are there. It is highly recommended that you wear a face covering.
If you are in an alert level 1 or an alert level 2 region you may travel into a region at alert level 3 to conduct a pre-settlement inspection as long as you enter the region with the purpose of moving into your new home. This means you may want to arrange with the seller to carry out your pre-settlement inspection the day before the property settles. You may need to need to arrange temporary accommodation to ensure you do not return to a region at a lower alert level while you wait for settlement day.
Alternatively, you could talk to the seller about postponing settlement and the pre-settlement inspection until the region your new property is in is also at alert level 2.
If you are in an alert level 3 region, you may travel into an alert level 2 region to conduct a pre-settlement inspection, as long as you enter the region with the purpose of moving into your new home. You should ensure you do not return to a region at a higher alert level while you wait for settlement day.
Read more about pre-settlement inspections and preparing for settlement here.
Settlement and moving can go ahead at alert level 3. House movers can work at alert level 3, so buyers and sellers can move house if they follow the government guidance on the COVID-19 website.
During alert level 3, travel into, out of, and through Auckland is heavily restricted. The Police are enforcing this at checkpoints around Auckland.
People can travel into, out of, and through Auckland if they are:
People travelling for these reasons do not require an exemption from the Ministry of Health, but should bring documents to support their reason for travel, if possible.
Your agent should arrange for sanitised keys to be provided with no physical contact between any party.
Read more about settlement day here.
Be considerate of the seller’s circumstances and needs – their situation may be uncertain.
New Zealand is in the middle of a unique situation where the health of all New Zealanders has to be the priority. It is likely to be stressful for all parties involved in a transaction, so be kind and consider the needs of others when you’re communicating about a transaction.
Open homes are not allowed at alert level 3. Where possible, you should view a property virtually, for example, by viewing a video of the property.
If required, private viewings can take place under alert level 3, however only people who are serious about making an offer should have a private viewing. There are rules to protect your health and the health of the agent and the property’s occupants:
If the property was listed during alert level 3 or alert level 4, the agent might not have been able to appraise the property in person. The agent should let you know this. Be aware that the estimated sale price might change when the alert level is reduced, and the agent is able to visit in person.
At alert level 3, professionals such as valuers, property inspectors and engineers cannot inspect a property before you make an offer, unless you are buying by auction.
If you have made an offer via a method of sale other than auction (for example, price by negotiation or tender), professionals may visit a property as long as:
If you would like a professional to inspect the property, you will need to include it as a condition in the sale and purchase agreement. Make sure you talk to your lawyer, or conveyancer about what conditions you may want to add.
All offers, including auctions and any multi-offer process, will be presented to the seller by email, phone or video call. If the property is being sold by auction, the agent will help you understand what the process is going to be and what you need to do to place a bid. You can read more about this here.
Doing things remotely may slow down some sales, so it is important to contact your lawyer or conveyancer early in the process so that you can meet any deadlines.
If a property is for sale by auction at alert level 3, buyers can commission a property inspection report before the auction. A property inspector may visit the property if the seller and the property occupants agree. Contact the agent to arrange a time for your property inspector to visit.
Sellers may have commissioned their own property inspection report for you to review. However, it is risky to rely on the seller’s report because if an issue arises later, you may not be protected if you have relied on a report that was not commissioned by you.
At alert level 3, the agent will work with you to put the terms and conditions you would like into the sale and purchase agreement. Make sure you send a copy of this to your lawyer or conveyancer to check before you sign it. Talk to your lawyer about what conditions you might need to put in the sale and purchase agreement to protect you against changes in alert levels and to ensure professionals can inspect the property before you buy it.
You can’t meet the agent in person to sign the agreement, so you may sign it electronically. In some cases, you could receive it by contactless delivery from either the agent or a courier. If you have the document delivered, you will need to sign it and courier it back.
Read more about sale and purchase agreements here.
The general buying process hasn’t changed at alert level 3. You may have time during this period to research the process and think about what you want in a home.
Learn about your different property options here.
Find out about different types of property ownership here.
Learn about the different information you should gather when researching a property here.
If you are concerned that a real estate agent isn’t observing the COVID-19 health requirements, you can report a COVID-19 breach using the form on the New Zealand Police website.
If you have a problem with a real estate agent that you can’t resolve directly with them, find out how the Real Estate Authority (REA) can help you on the REA website.