A man's, or woman's, home is their castle. Kiwis are passionate about property and home ownership. The property landscape can be a complicated one though so here's a recap of our recent updates.
Return of the 2-year bright-line tax rules kicked in 1 July
For many this will be great news but do remember, the bright-line period is calculated from the date you BUY a property to the date you ENTER into an agreement to SELL. There are also other income tax rules that could apply when you’re selling property so it’s important to get legal advice, so you fully understand your position.
Buying off-the-plans
When it comes to purchasing property off the plan, beware of the ‘sunset clause’. That’s a clause in a sale and purchase agreement giving one or both parties the ability to cancel the agreement by notice, if a specific event has not occurred by a certain date. The clause must be specific about what needs to happen, by what date, and who can cancel. Make sure any clause is in your favour and not the other party’s.
Entering into a sales and purchase agreement
Buyer beware when entering into a sales and purchase agreement if you don’t settle! Failing to settle on a property deal could cost you big time. All loss that the seller incurs can be passed on to the defaulting buyer. The deposit funds are not all you can lose!
Buying property with someone?
If you’re thinking about jointly purchasing a property with someone, it’s important to understand the two types of tenancy.
- Joint tenancy - where the owners have equal rights in the property (but if one person dies the ownership generally goes to the surviving owner).
- Tenants in Common - property is purchased in defined shares and if that co-owner dies, the share will become part of his or her estate and distributed according to their Will.