Changes affecting every buyer of residential land

Overseas Investment Amendment Act 2018 now in force

We covered the Overseas Investment Amendment Bill in Property Speaking’s Spring 2018 edition. The Bill has become law and is now the Overseas Investment Amendment Act 2018 (the OIA Act). It has been in force since 22 October.

The implication for you is that when you next buy residential property, there will be another layer of compliance to be completed before your property purchase goes through.

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Private land with public access

How is access granted?

Our ability to access the ‘great outdoors’ in New Zealand is seen as something of a citizen’s right. At times, however, It does conflict with the rights of private landowners when, in order to access the great outdoors, there is a need to cross their private land first.

The question of public access over private land has recently been becoming more of an issue. In particular, groups who are advocating for that access see the acquisition of private land by overseas people as an opportunity to gain more formal access over private land. Historically, New Zealanders have enjoyed a reasonably significant amount of access over private land – often based around relatively informal arrangements.

Public access over private land is a complex topic. This article gives you some background to the law relating to the rights of private landowners.

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Property Briefs

Warmer homes for Kiwis

Low-income homeowners or homeowners in low-income areas could be eligible for the new government grant to assist in keeping their homes warm in winter.

On 1 July 2018 the new four-year government program, Warmer Kiwi Homes, came into effect. Under this initiative the government will cover up to two-thirds of the cost of underfloor and ceiling insulation or, if you have a concrete floor, ground vapour barriers. Warmer Kiwi Homes only applies to homeowners who have a Community Services Card, however, funding help no longer stretches to landlords.

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The great lawyers’ fee debate

Lawyers’ fees are often a difficult subject to discuss. They shouldn’t be.

When setting a fee we need to consider many things but, ultimately, the fee we charge to you must be fair and reasonable – for us both. We need to be paid for the expertise we give to provide you with a trouble-free property transaction and you need to know what we do to ensure this happens for you.

Remember to ask us for a GST-inclusive cost estimate. Our cost estimate will usually have three components:

  1. Our fee
  2. The disbursement cost, and
  3. Office services charge.

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Business Briefs

Is your business infringing existing intellectual property rights? Do your homework.

A trade mark can be a valuable asset which can help your business to develop a reputation in the market and distinguish your goods and/or services from others. It’s risky, however, to not consider existing third party intellectual property rights before you start to trade.

There would be nothing worse than finding the perfect location, deciding on a business name and launching into trading, only to receive a letter six months later to say that your business is infringing existing third party intellectual property rights, and that you must stop using it immediately. In most situations the only way forward is to re-brand and potentially lose your existing goodwill and customer recognition.

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Purchasing from a developer who isn’t a builder – what are the pitfalls?

One of the increasingly popular options for purchasing a new house is to buy from a property developer who may not have actually built the house. Contract builders are brought in to construct new homes in subdivisions; the developer then sells on. This can result in a nice new house at a reasonable price.

However, there are risks associated with this type of purchase about which many people are not aware. Some of these risks can be mitigated with sensible contractual protection built in, others are simply risks that you can’t reduce.

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Pre-purchase inspections – what you can object to and what you can’t

The final step before you settle your property purchase is to undertake a ‘pre-purchase inspection’. This gives you the right (under the contract you signed) to inspect the property one last time and raise any last-minute issues about the property with the real estate agent and with us before settlement.

Having a pre-purchase inspection is not, however, the right time to try to negotiate a price reduction, or to attempt to raise new issues about the property.

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Bright-line test period extended

Property investors will be familiar with the bright-line test where there are potential tax issues if a residential rental property is owned for less than two years before it is sold. In addition to rental properties, the sale of a holiday home can be subject to a tax liability, as it is not a primary residence which is exempt.

In the current buoyant property market, many property investors have been considering selling other properties that form part of their rental portfolios.

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Is your rental safe and healthy?

Penalties for landlords dragging the chain

New laws came into effect on 1 July 2016 that require landlords to make their properties safe and healthy for tenants. These new laws provide some lead time for properties to be brought up to standard; they will apply to all rented properties from 1 July 2019. Will your rental property meet the new standard?

A recent Tenancy Tribunal decision shows that the Ministry of Business, Innovation and Employment (MBIE) is not shy of showing its teeth to ensure that tenants have safe and healthy homes by complying with the health and safety amendments to the Residential Tenancies Act 1986. The Residential Tenancies (Smoke Alarms and Insulation) Regulations 2016 outline requirements for rental properties, including underfloor and ceiling insulation, and requiring smoke alarms within three metres of each bedroom.

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Postscript

Food Act 2014 – rolling deadlines to register your food business

The legislation has introduced a sliding scale where businesses that are at a higher risk, from a food safety viewpoint, are required to operate under stricter requirements than lower risk outlets. The Ministry of Primary Industries (MPI) points out that a corner dairy operator who reheats meat pies is treated differently from a meat pie manufacturer.

New food businesses must register when they start to trade. Existing businesses are required to register with a set of rolling deadlines.

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