Selling Your Home Privately – Guidance Note

INTRODUCTION
With on-line marketing of property being as easy as having a smart phone and a Trademe account, selling
you home privately is a viable option for most owners.
Yes, you will need to invest time and energy in the process, and no, you will never be 100% sure you got
the top price possible. But you will save a large amount on the costs of sale, and for some that can be
the difference between making a gain, or making a loss on the sale. It should also be a satisfying
experience.
This Guidance Note is a brief summary of the things we recommend you think about and the steps to
take when selling privately. For help on your particular situation, please get in touch with us (contact
details at the end of this Guidance Note).

STEP ONE – MAKE YOUR PROPERTY DESIRABLE

Obviously, you need your place to look as sharp as it can look, both in the photos on Trademe, and in
reality when people walk through during open homes or private viewings.
Tidy-Up: It may be a good investment getting a professional in to tidy up the garden, or a tradie in to
complete unfinished projects.
Photos: You'll want some good pictures that show the property at its best. Most smart phones do a
perfectly adequate job these days, so don’t be afraid to get snapping yourself, ideally on a sunny morning.
Take lots and lots of photos, and then spend time selecting the best 20.
Fix the stuff that is not working: Make sure that all the working stuff is working (ie: heat-pumps, garage
remotes, range hoods, lights, dish washers, etc). This be a good look and make the property easier to
sell. In addition, under the standard Agreement terms, you will be warranting that all chattels plus heating
and lighting will be in working order on settlement – so make sure it is before going to market. Also, keep
in mind that the condition which the property is in when you accept an offer will fix your obligation in
relation to the condition the property will need to be on the settlement date. It can be in better condition,
but not worse when you eventually hand the keys over.
Have missing CCC's issued: Get any outstanding Code Compliance Certificates issued for any Building
Consents where work has been undertaken on the property by the CCC has not issued. The LIM report
from the Council (referred to below) will identify where CCC's have not yet issued. Councils are usually
good at helping you understand what needs to be done to have the CCC issue.

STEP TWO – GET YOUR INFO PACK TOGETHER

We recommend that you use a file sharing service such as DropBox to warehouse all the documentation
that you will want to make available to prospective purchasers.
DropBox is free and will generate a link which you can include in your Trademe listing, or email through
to prospective purchasers when they show interest. They simply click on the link and can download the
docs. No need for them to have a drop-box account to do this. It's super-simple.
The documents you should plan to get into your marketing pack should include:
1. Flyer: A simple one-page flyer with short property description, one or two photos, your contact
details, and the sale process being followed (see further detail below). This is mainly to print out
and have available at open homes, but should also be included in the DropBox bundle.
2. Contract: A template Agreement for Sale and Purchase on which purchasers can make their
offer (see further detail below).
3. LIM Report: A copy of the LIM Report from the Council for the property. We can order this for
you if necessary, or they are easy to order direct from the relevant council.

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4. Land Title: A current search copy of the land title for the property. Again, we can provide you
with a copy, or there are various on-line services which make them available for download for a
fee.
5. Insurance: A copy of your current certificate of insurance or insurance schedule.
6. EQC Information: If there were EQC claims made in relation to the property, then the Scope of
Works / assessment documentation for the claims. These can be obtained from EQC by
completing the form on the following link: https://www.eqc.govt.nz/contact-us/official-information-
act-request-form/. If you are unsure about whether there were EQC claims made in relation to the
property, do a property information search on the ECan website:
https://propertysearch.canterburymaps.govt.nz/
Note about Builder's Reports: As builders reports cannot legally be relied upon by anyone other than
the person who they have been commissioned by, a builder's report will be of limited comfort to a
purchaser. Therefore we do not recommend getting one done and including it in the marketing pack.
Purchasers can do this at their expense with their preferred inspector once they get the property under
contract. These also cost between $300 and $900. Our view is that they are not a cost worth incurring as
their value will be limited. However, some purchasers will elect to include them, particularly if the property
is in excellent condition, and this is supported by a builders report.
Note about valuations: Some people obtain a registered valuation for their property before selling.
However, again, purchasers will not legally be able to rely on a valuation obtained by you. If you decide
to get one, it will mainly be to inform you as to roughly what the property is worth. Valuations are also
only a 'best guess' as to where the market is at – they are not an actual sale. A purchaser who has looked
at a good number of properties may have a better and more valid idea about what the property is worth.
Whether to include a valuation is therefore a tactical decision for you to make. In our view it can be both
useful, and a hinderance. Costing between $700 - $1,200, our view is that on balance it is not worth it,
unless you are an executor of an estate or trustee of trust. If you are either of those, you may then want
to be able to demonstrate to beneficiaries that you have sold the property at or above market value.
Getting one obviously does not mean you need to disclose it to purchasers as part of the marketing
process. You can keep it to yourself if you wish.

TEMPLATE AGREEMENT FOR SALE AND PURCHASE

As we have outlined above, we recommend including a template Agreement for Sale and Purchase in
your marketing pack to make it as easy as possible for purchasers to make an offer on your property.
We prepare these for clients regularly and provide them with a cover sheet to help purchasers understand
what they need to do to make their offer. A copy of our cover sheet is included at the end of this Guidance
Note by way of example.
What conditions to include: Some lawyers take the view that when an agreement is put together for
sellers, it should include no conditions or warranties.
However, our view is that it is tactically better for a seller to include all the standard warranties and
purchaser conditions (detailed below). This keeps your pool of buyers as large as possible and does not
throw up any 'red flags' to purchasers. This should ensure you get the best possible price. It also reflects
a conventional approach to selling residential property in NZ (outside of an auction process).
The conditions we recommend be included are as follows:
1. Purchaser's solicitor's approval (5 working days);
2. Finance (15 working days);
3. Builders Report (15 working days);
4. LIM Report (15 working days); and
5. Insurance (15 working days).
Vendor purchase condition: If you are of the mind that you do not want to sell your current property
unless you can find somewhere else suitable to buy / rent, then it is possible to include what is generally
referred to as a 'vendor relocation condition'.
This condition benefits you (ie: you can cancel the agreement to sell your place if you cannot find
something else suitable) and may be important so you do not end up homeless! Purchasers do not really
like these conditions as they introduce a degree of risk to the purchaser as to whether they investing time

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and money in the process will be worth it. However they are generally accepted by purchasers if they get
the sense that you are a genuine seller / buyer.
Please let us know if you would like such a vendor relocation condition included and we can add on into
the further terms in your template agreement.
Drafting up a template agreement: It's a relatively quick and easy job for us to draft up a template
Agreement for Sale and Purchase for you in the standard form which everyone uses. To give us your
instructions to get on with this, we have an easy to use web info capture within the Forms section of our
website ( https://www.alaw.nz/instructions-private-asap/ )
We'll provide this to you by email in PDF form with the cover sheet as shown on the back, and then you
just upload it to your DropBox.
For more detail on the help we can provide you when selling privately, see the last section in this Guidance
Note.

WHAT SALE PROCESS TO FOLLOW?

One of the key decisions you will need to make is what sale process to follow in selling your house. There
are two main processes available to you as a private seller.
Deadline Sale
This is when you tell all potential purchasers that they need to submit their offers by a particular time and
date which is usually 4 weeks or thereabouts after you start marketing the property.
When agents sell using this process, they generally tell purchasers that as they are in effect a competition,
then need to "put their best foot forward" when making their offer on the deadline sale close date. It is
therefore a good sale process for generating excitement, and provides a target date by which you should
get an outcome from the sale process.
The offer to run a sale in this manner in fact forms a separate "process agreement" between you and the
prospective purchasers. Therefore, if you advertise that this is the process you are following, then you
will need to stick to that process.
To give yourself a little wiggle room, some sellers advertise that the property is to be sold "by deadline
sale closing [ time ] and [ date ], unless sold earlier".
If you are thinking about accepting an early offer before the deadline close date, then we recommend you
give all purchasers who have registered an interest 48hrs to get their own offers in. In effect, you bring
the deadline sale close time and date forward. You then look at all offers after that earlier time has come
and gone.
Apart from the process describe above, you as the seller hold all the cards. You can select to reject,
accept, or negotiate with any of the offerors.
In relation to how offers are submitted under this process, these can be made by email, or you can specify
where you would like offers to be dropped off at a particular location before the deadline sale close time
and date.
We are happy for you to invite purchasers to drop offers off at either of our offices. However, we find
these days that most purchasers are tech savvy enough to be able to scan and email their offers through
to you or us if this would be helpful.
It is common not to specify a price you are looking for in your marketing as part of a deadline sale process.
Our experience is that running a deadline sale process is the most effective way of selling privately.
Asking Price
This process involves you nominating an asking price for the property as part of your advertising, and
then just running an open-ended marketing process until someone makes an offer you are happy to
accept, or until you have had enough and take the property off the market.
This is probably the simplest process, and has its merits and disadvantages.
The merits are that purchasers generally like to know they are not wasting their time looking at a property.
Having no idea of what you are wanting to get for the property (which is common as part of a deadline
sale process) may put some purchasers off. The downside of this process is that it may not create the

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kind of "buzz" or competition which is created by running a deadline sale process. Purchasers may hang
off and see whether the property sells or not.
Offers Over
Similar to the Asking Price approach to selling, an "Offers Over" approach is also an open-ended
marketing process where you keep marketing until you get an offer you are happy to accept.
However, this process both gives purchasers an indication of what your price floor is, meaning that
purchasers can take a view as to whether it is likely be within their budget or not.
Auction
Although technically you could hire an auctioneer and run an auction process, this is very unusual for a
private seller and therefore we'll not include any information on selling via auction in this Guidance Note.
However, please let us know if you would like to put your property to auction and we can help you with
getting this under way.

STEP THREE – RUN THE PROCESS

This is when the hard work starts.
Trademe Listing: Get your photos uploaded and your listing live. Select the appropriate option for sale
process being followed and details as to when and where offers need to be made to. We do not
recommend including the GV in the information available. GV is not market value and is, in our view, a
misleading figure that has an unhealthy influence on the NZ property market.
Open homes: You should plan to run at least 3 – 4 weekend open homes before your deadline sale
close date (if that is the process you are going to follow). Open homes can be advertised on your Trademe
listing, or by direct communication with potential purchasers who get in touch.
To run open homes you should have:
1. An "Open Home" sign to put at the end of the drive or on verge on the street when you are open for
viewings. You can buy these off the web;
2. A schedule for recording people's names, phone numbers, and email addresses (both for your
records and use at open homes – see further advice on this below);
3. A "Please remove your shoes" sign (if appropriate); and
4. A COVID QR code so that people can record their attendance at the open home. This can be obtained
from Ministry of Health via their website.
Private Viewings
It's up to you as to whether you wish to offer private viewings in addition to, or instead of, open homes.
However, keep in mind that a seriously interested purchaser will likely want to come back after the open
home for another look (and maybe even another look after that). Go with it. This is a good 'buying sign'
and you will probably need to be prepared to accommodate such requests if made, within reason.
A note about capturing introductions: As noted above, we recommend you record who got in touch
with you about the property (via phone or email), and who attended open homes. This is so you can follow
up with the DropBox link to the marketing bundle, and possibly also to advise if you bring the deadline
sale process forward. Thinking ahead, there is also the chance that you will not be successful in selling
privately and then will list the property for sale with a real estate agent. As part of the agreement with the
real estate agent you may agree with them that they will not receive commission if the property sells to
someone you had introduced to the property – hence the need for a record as to who was introduced to
the property as part of your private sale process.
Receiving Offers
Hopefully on your deadline sale date you get some suitable offers.
In this regard, do not expect to receive many. Even when the market is hot, you may only receive 3 or 4
offers. In normal times it could be 2 or 3. The number of offers received is generally never high. Do not
be despondent about this. It is generally the same result that is generate by real estate agents when
acting on a sale.

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Take time to consider the offers, and seek advice from your lawyer if you are unsure about any terms or
conditions which have been included by the purchasers. We as a firm do not charge any extra for such a
review, and suspect that most lawyers will take a similar approach.
The rule with offers is: they are capable of acceptance until either a) the purchaser tells you that they are
withdrawing the offer, b) you advise them that their offer is declined, or c) you make a counter offer (in
which case the first offer by the purchaser is off the table).
Because of the above, before advising the other offerors that their offer has not been accepted, often a
seller will get a deal done with a preferred offeror (either by accepting the offer made, or by trying to
negotiating further).
You obviously want to be careful not to accept more than one offer!
Counter Offering
As outlined above, you could try and get a deal done by counter-offering – perhaps with a higher price,
or with a different settlement date etc.
Our standard cover sheet which goes on the front of template agreements which we produce for our
clients contains detail on how negotiations should be handled between seller and purchaser on. See the
copy attached to this Guidance Note.
As noted in that cover sheet, a counteroffer is a rejection of the first offer and therefore that first offer is
no longer capable of acceptance. There is therefore always a slight risk in making a counter offer and
whether to do this should be well considered before doing so.
Also, keep in mind that the purchasers who you are dealing with likely have been hunting in the market
for some time and therefore have a good idea of what 'market value' for the property is. Therefore, in
discussions with purchasers, avoid saying things like "the property is worth at least $ [ ]". This may dent
your credibility as a seller as the property is only worth what a willing buyer is prepared to pay.
Therefore, if you are genuine about selling, keep in mind that the offers made by the purchasers are an
expression of a functional market, and may indeed be the market value of the property at the time the
offer is made. You may then have to decide to "meet the market" if you wish to sell.
Dating and Circulating the Offer
Once you have a deal:
1. Date it at the top of the front page of the Agreement;
2. Scan and email it to the purchaser advising them that the deal is done; and
3. Scan and email a copy to your solicitor.
That's it. Well done! The hardest part for you is done. Your solicitor should put energy into the sale
process from here on.

STEP FOUR – STAND BY TO GIVE THE PURCHASER FURTHER ACCESS TO THE PROPERTY
As you are not using a real estate agent for the sale, you will need to stand by to give access to the
property to the purchaser in the following situations:
1. Builders Report: When their building inspector needs to get into the property as part of them drafting
a Builders Report for the purchasers; and
2. Pre-Settlement Inspection: In the run-up to settlement, the purchasers may well request a "pre-
settlement inspection". The standard sale Agreement between the parties includes a right for them to
do this. It is an opportunity for the purchasers to check that the property is in no worse condition than
it was in when they signed the Agreement. It also gives the purchasers the opportunity to check
whether the working stuff in the house is working (heat pump, range hood extractor, lights, etc). It's
an obligation of the seller in the Agreement to deliver the working stuff in working order on the
settlement date.
Getting the purchaser (or their building inspector) into the property in these situations is usually facilitated
by the real estate agent, hence the need for you to be on stand-by to provide access yourself at a time
which suits you.

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WHAT DO YOU NEED TO DISCLOSE TO THE POTENTIAL PURCHASERS ABOUT THE
PROPERTY?
Generally, nothing (see one exception below).
Selling a house is no different to selling a car. You have no obligations to disclose anything about the
property to the purchasers. The risk when buying a property is with the purchasers and follows the
standard contractual apportionment of risk which is captured in the Latin words "caveat emptor": let the
buyer beware.
That said, you cannot make misleading or false statements about the property, and should avoid
innocently providing helpful information on the property which an aggrieved purchaser may claim was a
misrepresentation.
Therefore, when providing information on the property, be cautious.
Hence, if someone asks, "What condition is the roof in?", do not respond with, "Great. Many years of life
left in the roof."
Your response should rather be, "We have included a builders report condition in the template agreement
and we recommend you use it to get your own professional assessment of the property including the roof.
However, we have had no problems with the roof during our time of ownership."
As a rule in these situations: less is better. There are invariably risks with oversharing. But fundamentally,
you do not need to tell the purchasers anything about the property.
The only exception to this is (and it is very rare) if you have received a notice from the Council on such
things as the street outside the house being widened or that some part of your property is non-compliant
with the Building Act or the rules in the district plan. The standard purchase agreement includes a
warranty from you as the seller that these 'notices' have been disclosed to the seller.

THE COMFORT THAT COMES FROM USING AN AGENT

As we outlined at the outset, when you sell privately you will likely always be left wondering whether you
got top value for the property.
It is likely that you will indeed achieve top value, and even a bit more when you consider that you will not
be paying the significant amount charged by real estate agents in commission.
However, arguably one of the most valuable services provided by an agent is advising you as to whether
the offer being made is a good one or not. Yes, agents want the deal (and would like to be paid). However,
their professional obligation to you is to advise on whether the offer is a good one or not, the state of the
market considered, and our experience is that most agents do a great job at providing this input.
Therefore, if you decide to sell privately, you will need to accept that you will not receive the comfort of
knowing that you got top $$$ for your property, even though you likely will have.

SERVICES WE OFFER PRIVATE SELLERS

We are involved in a very large number of residential property sales and purchasers every year. These
are undertaken on the all-inclusive fixed-fee basis which we offer to the market. More details on these
can be found on these services in the Costs section of our website (https://www.alaw.nz/our-fees/).
However, for private sellers we offer to undertake the following additional help:
1. Drafting Template Agreement for Sale and Purchase ($175.00 all incl). If you would like us to
draft one of these for you to use as part of your sale process, please complete the Private Sale
Agreement info capture in the Forms section of our website (https://www.alaw.nz/instructions-
private-asap/). We'll then get that together for you and will be in touch.
2. Putting together Private Agreement Marketing Pack ($750.00 all incl). If you would like us do
this, we will put together a DropBox marketing folder to include the template Agreement for Sale
and Purchase (refer above for details on how to provide us with the information we will need), the
Council LIM report for the property which we will order for you, plus a copy of the land title). We
will also undertake a LIM review to see whether any compliance 'tidy-ups' are needed before you
go to market.
Looking forward to being of service. Please let us know if you have any queries.

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alaw.nz
163 West Street Ashburton 7700
9 / 21 Humphreys Drive Christchurch 8023
Telephone (03) 928 8165
[email protected]

alaw.nz
 SALE OF [ PROPERTY ADDRESS ]

FOR PURCHASERS – EASY STEPS TO MAKE YOUR OFFER

To make your offer, fill in the red rectangles in the agreement as follows (match numbers):
1. Names: Your full names - middle names included.
2. Price: Your proposed purchase price.
3. Take Over Date: Your preferred take-over date (referred to as the settlement date).
4. Sign here: Sign as the Purchasers.
5. Your details: Include your contact details here.
6. Your lawyer's details: Include your lawyers name and contact details here; then
- Present your offer: Scan/email or give your offer to the Vendor.

NOTE ON PURCHASER CONDITIONS

We have included a number of standard Purchaser conditions in the Further Terms of Sale to give
you confidence to put an offer forward. If you want to make your offer even more attractive, or do
not need some or all of these conditions, just strike them out and put an initial next to your strike
out.

FOR VENDORS – HOW TO ACCEPT AN OFFER

If you would like to accept an offer, fill in the red rectangles in the agreement as follows (numbers
match):
7. Sign here: Sign as the Vendor;
8. Date: Put the date on the Agreement; then
- Inform Purchasers: Tell the Purchasers that their offer has been accepted; and
- Get Agreement to us: Scan/email, or drop in. We will take things from here.

HOW TO MAKE AND ACCEPT COUNTEROFFERS

If either Vendor or Purchaser wants to make a counteroffer, this is how it is done:
- Strike out: Strike out the term you want changed (ie: Purchase Price, deposit, date etc)
- Add in: Write in the new term (ie: new Purchase Price, deposit, date etc);
- Initial: Initial next to the change you have made; and
- Resubmit offer: Give the counteroffer back to the other side for consideration.
Remember that once a counteroffer has been made, the original offer is dead.
Once a counteroffer has been accepted (and there is a meeting of minds that a deal has been
done):
- Date the front page: Date the Agreement at 8;
- Inform the other party: Tell the other party that their counteroffer has been accepted; and
- Get agreement to us: Get us the signed and dated agreement. We will take things from here.

Please let us know if you have any queries.

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