Tackling money laundering

Anti-Money-Laundering

To improve New Zealand’s ability to tackle money laundering and terrorism financing, the Government has made law changes that affect various businesses and professions.

 

Each year about $1.35 billion from the proceeds of fraud and illegal drugs is laundered through everyday New Zealand businesses. These law changes – put in place practical measures to protect businesses and make it harder for criminals to profit from and fund illegal activity. They’ll also safeguard and help New Zealand live up to our reputation as being one of the least corrupt countries and a good place to do business.

 

The law will come into effect in stages for different sectors to give businesses time to prepare for the changes. From 1 January 2019, real estate agents will have to comply with the AML/CFT Act when representing a client who’s either selling or buying real estate.

 

 

New restrictions for overseas buyers

Overseas-Investment-Amendment-Bill

The Overseas Investment Amendment Act comes into force on October 22nd 2018 and will impact every residential property transaction.

The bill amendments aim to ensure that investments made by overseas persons in New Zealand will have genuine benefits for the country.

Queenstown Law kindly answered some of the most asked questions regarding the new amendments.

What is included as “Residential Land”

Land that has a property category of residential or lifestyle.

 

Who can buy Residential Land and who needs consent?

  • New Zealand, Australia and Singapore Citizens can purchase with no restrictions;
  • Resident Visa and Permanent Resident Visa Holders of New Zealand, Australia and Singapore need to meet 183 days NZ residing test in the previous 12 months
  • All others will need consent to purchase

 

Are there any exemptions?

Yes. The key ones for the purposes of overseas property investors are:

  • Buying a dwelling in a large apartment block off the plans
  • Buying a Hotel unit and leasing it back for hotel use

 

Transactions entered before October 22nd 2018, when the Act comes into force, will not be affected by the Act. Not sure if the new amendments affect you? Talk to us to find out.

 

The key benefits of buying off-the-plans

Buying-Off-the-Plans

Buying off-the-plans is sometimes portrayed as a ‘risky’ investment but buying before the property has been built can hold many benefits from financial gains to peace of mind. Here are our top five benefits of buying off the plan:

 

  • You get your pick of the properties! Buying off the plans means more selection as your favourite may have sold once construction has started.

 

  • You don’t have to worry about ongoing maintenance an older property sometimes requires.

 

  • It’s new! We all love something new and you will maximise your rental return as tenants will pay more to live in a new home.

 

  • The property market is quickly changing and as property prices increase, there is potential to make a profit on your development during the process.

 

  • Prices sometimes increase as construction nears completion, you could pay a little less by buying off the plans.

 

 

Harcourts scoop Most Trusted award for sixth year in a row

Harcourts-Most-Trusted-Real-Estate-Brand

Reader’s Digest has announced its Most Trusted brands for 2018, and Harcourts, New Zealand’s largest real estate brand has come out on top. Meaning that for the sixth consecutive year, New Zealanders have voted Harcourts their Most Trusted real estate brand and making Harcourts the only real estate brand to have held this honour for this continuation.

 

Harcourts CEO Chris Kennedy says the support and faith New Zealanders continue to put into the company is humbling.

 

“To be named the Most Trusted real estate brand for six years in a row is an incredible achievement. We are not only proud of our teams across the entire country, but we want to thank those New Zealanders who have worked with us and voted us number one.”

 

“We take the trust New Zealanders place in us very seriously. After all, making the decision to buy or sell a property is often one of the biggest, most important financial decisions all of us will make. You want to know that the sales consultants you are working with have knowledge, experience, honesty and integrity.”

 

The challenge for the company is to keep finding new ways to deliver exceptional customer service. “That is absolutely always at the core of everything we do. We are constantly looking at ways to improve our clients’ experience with us,” he says.

 

“To ensure Harcourts is living up to this goal of offering clients a premium service, the company will, in 2018, launch a client experience project. This will allow every customer the opportunity to rate their experience with our company and our people, in a transparent way that can be measured. It’s an exciting innovation which will allow Harcourts to continue to grow our people and constantly evolve our service to clients.”

“You hear it said a lot, that no relationship can work without trust. Trust is something you can’t put a price on. That is why this title of Most Trusted is so important to us.”

 

Harcourts will receive this prestigious award on 30 May alongside other elite Kiwi brands such as Whittakers.

 

Thank you, New Zealand.

 

Buying in a millennial market

Millennial-Home-Buyers

As the millennial generation step on to the property ladder, we see different trends emerging and more caution being taken when buying first homes. Deemed by some as the ‘pickiest home buyers’, Generation Y are turning the tides of real estate.

Where generations before had limited resources when buying property and considered their first purchase a lifelong family home, millennial’s have an overwhelming amount of information at their fingertips and consider their first home a stepping stone or starter property on the way to their big picture goal.

One thing that remains the same, buying a house is the biggest financial decision you will probably make. Ever. Can we help you? Absolutely, keep reading for our top tips for millennial buyers.

 

Define your goals

Figure out what it is you’re looking for and if you’re going it alone or with a partner/friend. Ryan Hardy, luxury real estate agent says, “Given that buying a home is such a big step, it’s important for you to educate and prepare yourself as much as possible in advance. This means clearly determining why you’re buying and what kind of home you’re looking for”. Define your house goals, whether it’s an investment property or your new family home. Facing the property market with a clear idea of what you want will make the process easier and much less daunting.

 

Examine your finances

Look at what you can afford and keep in mind that you may need to spend money on the property to personalise it further down the line. Speak to your bank and discuss the best plan of action and what your budget will stretch to. Remember, interest rates can change as economic conditions fluctuate, will you be able to afford your mortgage payments if they increase? Perhaps buy a property slightly under your budget so you have a safety net.

 

Talk to the professionals

Determining your budget or knowing a properties worth isn’t easy. Talk to the professionals and work together to find your dream home within your budget. There are many mortgage and payment options, a specialist can help you choose the right one for you. A real estate agent can review your property checklist and provide an option you may have overlooked.

 

Look beyond the great views

Know the property inside and out before buying, not preparing for necessary renovations or essential work takes its toll on the budget and you. Find an agent who provides you with detailed inspections and keeps you updated regularly.

 

Talk to one of our agents for more information.

Insulation Regulations For Rentals

NZ-Insulation-Regulations-Harcourts

Landlords are now obligated to provide warmer, drier and safer homes for their tenants. Any new, replacement or top-up insulation installed after 1 July 2016 in a rental home must meet the regulations that will apply to all rental homes from 1 July 2019. A landlord who fails to comply with the regulations is committing an unlawful act and may be liable for a penalty of up to $4,000.

Insulation is one of the most effective ways to save energy in a home since it keeps it warm in the winter and cool in the summer. And a warmer home is a drier, and healthier home. It is estimated that in one year a typical home can save up to $400 on energy bills by installing ceiling insulation. Adding underfloor insulation could save even more!

Recent studies in New Zealand have shown a link between insulation and health. The Wellington School of Medicine and Health Sciences study showed:

  • A significant drop in energy use when the houses were insulated.
  • Once the houses were insulated, they were drier and warmer.
  • People in insulated houses reported their houses were “significantly warmer”.
  • There was a significant improvement in the self-reported health of those living in the insulated houses compared to those whose houses were not insulated.
  • Adults and children in insulated houses reported visiting their GP less.
  • Adults and children in insulated houses reported that they were admitted to hospital less often for respiratory conditions.
  • Adults and children in insulated homes were significantly less likely to report sick days.
  • People living in insulated houses reported less visible mould inside their homes.

Who is exempt?

As New Zealand has many types of houses, the law allows for some exceptions to the insulation requirements, including where it is not ‘reasonably practicable’ to install insulation in certain types of property. These exceptions are not loopholes – they must be legally justifiable.

Due to the design or construction constraints of some property types, it is sometimes either not physically possible to insulate or would require major renovations to do so. Examples of types of properties that would meet exception criteria would be apartments where there is a habitable space above and below the apartment, houses constructed on concrete slabs where it is not feasible to install underfloor insulation, and homes with skillion roofs where there is no ceiling in place to install insulation above.

Other situations in which landlords may be exempted from the insulation requirements are:

  • Where within 12 months of the start of a tenancy, the landlord intends to demolish or substantially rebuild all or part of the property. In this case the landlord must, if requested, provide evidence of having applied for the necessary resource consent and/or building consent for the redevelopment or building work.
  • Where a property is purchased from and immediately rented back to the former owner-occupier – in which case a 12 month exception will apply from the date of purchase.
  • If a property does not meet the new insulation requirements, but a landlord can provide evidence that when insulation was originally installed it did comply with particular insulation requirements (such as the specifications outlined in the building consent or an Acceptable Solution or Verification Method) the property is excluded from new requirements, provided the insulation is in reasonable condition.

To read the full Insulation requirements, click here.

Understanding the upcoming bright line test changes

bright-line-test-nz

Revenue Minister Stuart Nash confirmed that the election “promise” to extend the bright line test from 2 years ownership to 5 years will be enacted, effective for properties acquired after the date of Royal Assent. The intended purpose of extending the bright line test is to ‘dampen property speculation’ and make homes more affordable. The extension means that profits from residential investment properties which are bought and sold within five years will generally be taxable.

Current exemptions from the bright line test will remain. They include the sale of an owner-occupier’s main home, inherited property, or the transfer of property in a relationship settlement.

The extension to the bright line test will apply to residential investment properties purchased from the date on which the bill receives the Royal Assent, which is expected in March. Nash adds that the passage of the bill will also enable the Tax Working Group to factor the change into any consideration of a comprehensive capital gains tax.

Auckland Property Investors Association president Andrew Bruce has previously said that the changes will impact on property speculators rather than long-term investors. “The majority of property investors are in it for the longer than five years and are unlikely to feel massive levels of pain with the extension of the bright line test.

See more information on the bill, click here.

Free Appraisals

Want to know what your home's worth?

Sign up for our completely free, no-obligation home appraisal.

captcha
osbornes

SERVICE FIRST

Our approach begins and ends with client care: you are our priority.

osbornes

GLOBAL ATTENTION

The Harcourts international network spans 830 offices in 10 countries.

osbornes

MOST TRUSTED

Harcourts is NZ's Most Trusted Real Estate Brand (Reader's Digest, 2012-16).