Leon Chen
Mar 4, 2019
In New Zealand, buying and selling houses and applying for loans often involve some technical terms. What do these terms mean?
Here's a summary for you.
An auction is a public bidding process for property, where the highest bidder wins.
A Body Corporate is a group of owners of a multi-unit building or a building with multiple units, responsible for the management and maintenance of common areas.
Capital Value: This is the value of the property, including the land and the house (or any construction), but excluding interior furnishings such as curtains, carpets, and lighting fixtures. The property value will be shown on the tax bill issued by the municipal government.
Certificate of Title: A property title deed, a certificate of ownership of a property, containing information about the house and land.
Chattels include movable interior decorations such as curtains, lighting fixtures, and carpets. Sometimes furniture is also included.
Commission is the commission paid by the seller to the real estate agent, and is generally paid when the sale and purchase agreement becomes unconditional.
Cross-lease refers to the joint ownership of a land by all owners where two or more houses are built on the same plot of land.
Cross-lease means that each homeowner leases the land from other homeowners.
Fixtures/Fittings: Furniture added to a house that is not moved, such as stoves, storage shelves, and built-in cabinets. * Freehold: This is the most common type of property title. It means the right to own the land and house without restrictions. Another meaning is that the property is not subject to any mortgage or loan.
A Land Information Memorandum, also known as a Lim Report, contains information on land use, geology, drainage systems, land taxes, and all works for which permits have been applied and approved.
Leasehold land, as the name suggests, is land leased out, and rent must be paid annually to the owner of the land title. You may own a house built on the land, but when you sell the house, the leasehold must be transferred along with it.
Market Value: The value of a property in terms of market demand at the time.
A mortgage is a legal document that provides the borrower with a property as collateral. If the borrower is unable to repay the loan, the borrower has the right to sell the property to recover the outstanding amount.
Mortgagee Sale: When a homeowner is unable to repay their mortgage, the lender sells the property.
MREINZ is short for Member of the Real Estate Institute of New Zealand. All real estate agents should be members of this association and must abide by the guidelines and regulations set by the association.
A private sale is a property sold privately by the owner without the involvement of a real estate agent.
Rateable Value: The valuation made by the municipal government on the property tax bill, used to calculate the property tax payable.
Sale Purchase Agreement
Settlement Day is the final stage of a sales transaction, when the buyer pays the money, the property title is transferred, and the keys are handed over; it is also known as the settlement day.
Tenders are accepted. Interested buyers submit written bids for the property.
An unconditional sale and purchase agreement is a contract without any attached conditions, or one where all conditions have been fulfilled. An unconditional sale and purchase agreement is legally binding, and both parties must transact on the date specified in the contract at the price agreed upon in the contract.
Unit Title: This is typically used in multi-unit buildings where each owner has their own unit, while common areas such as staircases and garages are managed by a group of owners.
Vendor seller, owner