Sales and Purchase Agreement
When you buy a section from someone, you are entering into a contract - you are the purchaser and they are the vendor. You will sign a sale and purchase agreement, which will contain the terms and conditions for purchase of the section.
The sale and purchase agreement will usually be drawn up by the person selling the section, or by the real estate agent.
There are a couple of standard forms available. The most common one is the Auckland District Law Society (ADLS) form which has been in use for many years.
Whatever form is used, the sale and purchase agreement should contain:
- The details of the certificate of title.
- Any improvements to be made by the vendor before settlement.
- The price, including the deposit.
- Provision for adjustments to be made to land tax, council rates and water rates.
- The rights of the parties to cancel the contract.
- Warranties which relate to such matters as council consents under the Resource Management Act 1991.
- Special clauses making the agreement conditional on such things as:
- Your solicitor’s approval of title;
- A satisfactory valuation;
- Your approval after you have obtained a LIM;
- You arranging suitable finance.
The date when the agreement becomes unconditional and the settlement date.
Before signing anything, read the agreement thoroughly. And get legal advice.
Both you and the vendor carry risks in signing an agreement for sale and purchase. Once signed, it is a binding contract.
However, if the agreement is conditional and one of the conditions is not met – for example, your finance falls through or you find something on the LIM that means you won’t be able to build the house you want – then you may be able to cancel the agreement. But once all the conditions are met, you must follow the purchase through.
The Building Contract
Master Builder recommends that anyone who engages a Registered Master Builder should use their standard RBC1Building Contract. This contract contains comprehensive payment schedules along with other valuable protection.
When entering into a building contract with a Registered Master Builder, we recommend that you incorporate a form of payment schedule into your building contract. The Staged Payment Schedule and Progress Payment Schedule are examples of this. They are included in the RBC1 Building Contract. These are important as it allows you to keep track of all monies paid and ensures that you only pay for work that has been completed so should something go wrong you have enough money left to complete the build with someone else.
There are many factors that can delay the building process, such as waiting on suppliers or the weather. We advise keeping in contact with your builder and maintain realistic expectations about the potential for unforeseen circumstances to arise. Honest and open communication is key.
If you have serious concerns about the ability of your Master Builder to finish your build, you should contact Registered Master Builder Association if you have a guarantee to discuss this. If they feel that there is genuine concern with the delays, then this could lead to further action by Master Build Services.
Our Registered Master Builders will help you through these steps. Find a Master Builder
Types of designer
An architect is a person who is registered with the New Zealand Registered Architects Board (NZRAB). Only a person who has met the registration requirements of the NZRAB can call themselves an architect, and they must hold a practising certificate issued by the NZRAB to be able to practice.
Most architects have studied architecture at university and gained an architectural degree. An architect is competent in the design and coordination of all building elements, services and site works, as well as the management of each stage of the building process, from concept to completion. An architect will be able to consider your ideas and come up with distinctive and innovative solutions for you that can be built within agreed cost and time parameters.
Many architects in New Zealand belong to the New Zealand Institute of Architects (NZIA).
An architectural designer is someone who specialises in building design and construction, from conception to final certification. They can provide a service that includes design, full working drawings, contract documentation and contract administration.
Although architectural designers are entitled to practice ‘architecture’, they cannot call themselves ‘architects’.
Architectural designers will probably have studied at a tertiary institution, and are specifically trained in the technical aspects of design and detailing. They should also be familiar with all the Building Code and local authority requirements (such as building and resource consents).
Many architectural designers are represented by Architectural Designers New Zealand (ADNZ).
An architectural draughtsperson can draw up plans from your basic ideas. They will be cheaper than an architect or architectural designer, but you may not get the same design flair.
This is a good low-cost option in many situations. For example, if you want your laundry redone, a draftsperson can prepare the drawings and instructions for the builder, plumber and electrician.
They usually have technical institute training and some may be members of ADNZ, while others may be connected to the Design Association of New Zealand (DANZ)
Using a lawyer
Before you sign anything, discuss the legal details with your lawyer, i.e. the certificate of title, information in the LIM and council files, and the terms in the sale and purchase agreement.
Basic services from a lawyer won’t include a check on zoning, and other specific information about the site unless you ask them to do this.
The lawyer can advise you about items on the title like a right of way, how many other people have the right to use it and what obligations users have to maintain it.
They can help you negotiate the price and help you organise finance.
A lawyer can also advise you about your ownership of the site – whether you want to own it jointly with your partner or spouse, or in differing shares with your partner, spouse or someone else, depending on your circumstances.
For more information on the services lawyers can provide, go to the Property Law Section of the New Zealand Law Society
It is common to change your mind on what you want once a building project is underway. These are called variations and should be discussed with your builder as soon as possible. There may be reasons why the changes cannot be made, or such changes may incur more cost. Asking early and obtaining quotes on any potential variations ensures effective communication between you and your builder and ensures everyone’s expectations are being met.
What's in a PIM?
A PIM (Project Information Memorand) is a report that contains Council information which may affect your proposed building project. It provides information about the work site that may have an effect on the work. Planning restrictions, the location of stormwater drains and ground conditions are some examples.
It may tell you about:
- Protection of the land or buildings, for example, by the Historic Places Trust
- The location of services, such as water and waste systems on the site and adjoining land
- Land details such as ground stability, geological history, areas that have been filled, or have been unstable or if there is any risk of flooding
- Permitted footpath crossing points
- District plan non-compliances
How to apply for a PIM
A PIM can only be applied for by someone who is planning a specific project and may need a building consent (see information below).
You can apply for a PIM at the preliminary design stage of the project or at the same time as you apply for building consent. If you apply for a building consent without applying for a PIM, your consent application will be treated as including an application for a PIM.