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Where to live

If you are not directed by work, educational or any other specific considerations choosing which part of New Zealand you want to settle in may require some thought and some more research.

Perhaps one of the most important decisions you will need to make will be the decision to rent or to buy. Renting is strongly recommended especially for new arrivals in the country. Renting gives you the option of establishing a ‘home base’ while you explore the country, suburbs, living styles and everything else that goes into making a house a home.

Choosing somewhere to live

Part of the decision process on whether to emigrate or not was to decide where you were going to live. Those decisions may still be completely valid, however now you are in the country and experiencing it first-hand you may be feeling you would like to see what the New Zealand has to offer.

New Zealand is a long narrow country, with large geographical features that generate quite different climates and lifestyles. As a result one early consideration, if possible, might be to put off a long term commitment to a residence until you have seen the rest of the country.

The north of the North Island can be almost tropical, rarely sees a frost and has great beaches and fishing.

Moving down the North Island you will come across city lifestyles, dairy and horticulture farming, forestry, tourist venues, trout fishing and many different kinds of coastal lifestyles. There are adventure lifestyles, technical, IT and teaching opportunities, arts and café cultures, green and other rural opportunities.

To the south end of the South Island you can have a true ‘European’ climate with 30 degree plus Celsius temperatures in summer, snow in winter, and distinctive Autumn and Spring, whereas in the north it’s green all the time.

There are wineries in almost every part of the country now and surprises around every corner so it is a good idea to spend some time exploring different areas.

It might help to make some objective comparisons for a start. Have a look at the statistics and introductions at www.ssnz.govt.nz/regional-information/index.asp, and if you see some places you like try comparing them using the regional calculator.

(www.ssnz.govt.nz/compare-regions/index.asp)

Perhaps one of the most important decisions you will need to make will be the decision to rent or to buy. Renting is strongly recommended especially for new arrivals in the country. Renting gives you the option of establishing a ‘home base’ while you explore the country, suburbs, living styles and everything else that goes into making a house a home.

Renting

Perhaps one of the most important decisions you will need to make will be the decision to rent or to buy. Renting is strongly recommended especially for new arrivals in the country. Renting gives you the option of establishing a ‘home base’ while you explore the country, suburbs, living styles and everything else that goes into making a house a home.

Renting is a good first option when you arrive, because it gives you the security of a place to call home without the big financial commitment.

A beginner’s guide to renting – A lot of New Zealanders own their own homes, so there is less rental housing available here than in most developed countries.

Prices and quality also vary and we recommend you visit the actual property personally before signing a lease (Tenancy Agreement). Other things to think about include how close the property is to transport, shops and schools, as well as the general feel of the neighborhood.

Most rental properties are unfurnished, apart from an oven, a laundry facility and things like curtains and carpet. The landlord does not have to provide a heater so, in some cases, you may have to provide your own. So make sure you know how you are going to stay warm. Demand for good quality rentals is high. It may take some time to find a suitable property and, when you do, you will usually have to make a quick decision.

Real Estate agents

Many real estate agents also deal in rental properties and can help you find a property for which you pay a commission. Their commission charges are due only once a rental contract is completed, and should not exceed one week’s rent.

Letting centres

Letting centres are another way to find a property. These centres usually charge a fee for you to look at their listed properties. The fee is generally less than that charged by real estate agents, but it may be charged even if you do not find a home through their lists. If you are referred to a real estate agent by the letting centre, you may also have to pay the real estate agent’s fee.

Types of tenancies

There are two types of tenancies:

Periodic – this is any tenancy that is not for a fixed time, and continues until the landlord or the tenant ends it by giving notice, or the Tenancy Tribunal orders that the tenancy is over. This is the most common form of tenancy. In most circumstances, a tenant can leave this type of tenancy by giving 21 days’ notice in writing. A landlord needs to give either 42 or 90 days’ notice.

Fixed-term – these finish on a date recorded in the agreement, and neither the landlord nor the tenant can end the tenancy earlier unless it’s by mutual agreement. It is a good idea to seek advice from the Department of Building and Housing before signing an agreement for these types of tenancies.

Tenancy agreements

Your landlord must provide you with a Tenancy Agreement Form. This sets out the conditions of the lease in plain language. Both you and the landlord sign the agreement and keep a copy. Never sign anything you do not understand. Your landlord cannot include anything in the agreement which is different from the law. If they do, it is unenforceable. For a detailed description of what information should be included in a tenancy agreement see the Living Guide (www.ssnz.govt.nz/publications/LivingGuide_all.pdf).

Property Inspection Report

A Property Inspection Report is usually included with the tenancy agreement. It is important to record and agree with your landlord not only the furniture and fittings (such as lampshades and curtains) that are provided, but also the condition of the property and any equipment. For instance, if the kitchen bench has a burn mark on it, make sure this is noted in the report so you are not held responsible for it when the tenancy ends.

What you will need to pay

When you agree to rent a property, you usually need to pay:

  •    A fee to the letting agent if you have used one
  •    A bond (a deposit)
  •    Rent in advance.

You will also need to pay to connect the telephone, electricity and perhaps gas.

Bonds (Deposit)

Most landlords will require you to pay a bond equivalent to 2 or 4 weeks rent. They cannot ask you for more than 4 weeks rent as bond by law.

Your landlord will give you a Bond Lodgment Form that you and the landlord both need to complete and sign. The landlord must lodge the form and your payment for your bond with the Department of Building and Housing within 23 working days of receiving them. You and your landlord will then both be sent a receipt.

If you don’t receive this receipt, you should contact the Tenancy Advice Office of the Department of Building and Housing. Your bond will be refunded when you leave the property, unless you have rent owing or you have caused any damage. If there is damage, some or all of your bond can be used to pay for the repair.  When you tell your landlord that you’re going to move out, they will inspect the property. You and your landlord then sign a Bond Refund Form and send it to the Department of Building and Housing, and your bond will be refunded.

If you cannot reach agreement with the landlord over the return of your bond, contact the Tenancy Advice office at the Department of Building and Housing.

Paying rent

A landlord cannot require you to pay more than two weeks rent in advance. However, it is possible to make monthly payments if you and your landlord agree. The landlord must give you a receipt for any rent you pay by either cash or cheque. If you use automatic payments, your bank records act as receipts.

Rents are determined by market demand and can vary widely depending on the property. You can check out market rents in your area on the Department of Building and Housing website.

If you think your rent is higher than it should be compared with similar properties, you can apply to the Tenancy Tribunal through the Department of Building and Housing for a market rent assessment.

If the Tribunal orders a lower rent, the landlord must comply with this ruling and also cannot increase the new rent for a period set by the Tribunal (usually six months).

If you have a periodic tenancy, your landlord cannot increase the rent within six months of either the start of the tenancy or the last rent increase. Rents for fixed-term tenancies also cannot be increased more frequently unless the Tenancy Agreement specifically provides for this.

Insurance

When you rent a house, your rent does not include insurance for you, so it’s important you take out contents insurance for both your possessions and to cover you for any liability for accidental damage to the property.

The insurance may also pay for you to live somewhere temporarily if there is an accident and the house can’t be lived in. It is your landlord’s responsibility to insure the actual property/building.

Further information

There’s a lot more information about renting including details of how to end a tenancy, repairs and disputes contained in the Living Guide. It is a good idea to find out about your legal rights and responsibilities well before signing a lease. The Tenancy Services division of the Department of Building and Housing can help you with this.

To download Bond Lodgment and Bond Refund forms, visit:   www.dbh.govt.nz

Property Inspection Report Forms are usually part of Tenancy Agreement Forms. To download Tenancy Agreement Forms, visit:  www.dbh.govt.nz

Free advice and information on renting is available by phoning 0800 83 62 62 (0800 TENANCY) or at www.dbh.govt.nz.

FREE Booklets on Renting

The Department of Building and Housing has two free booklets on renting:

What to do when you’re renting – a handy, step-by-step guide for tenants.

Renting and you – a guide for both landlords and tenants, available in Samoan, Tongan, Chinese Traditional, Chinese Simplified, Arabic and Korean as well as the standard Maori and English versions.

Both publications can be downloaded from:  www.dbh.govt.nz

Buying

Buying a house

Buying your own home is a big decision. It’s a commitment you may want to delay until you’re feeling settled in. In addition it is important to make sure the emotions of emigration do not unduly influence your decision making process when considering buying property.

A beginner’s guide to buying

There are many different types of housing in New Zealand, ranging from rural ‘lifestyle blocks’ to villas to modern suburban homes and apartments. There’s a good breakdown of the different types of New Zealand housing in the Living Guide. (www.ssnz.govt.nz/publications/LivingGuide_all.pdf)

Prices for homes in New Zealand are equally varied. A lot depends on where they are located, for example; homes in Auckland are generally more expensive than homes in Hamilton. House prices in smaller cities and towns tend to be less expensive than in larger centres. Costs also vary within neighborhoods and it is essential to find out as much as possible about an area before you buy.

Take time to look around and become familiar with the market. Buying a home is an important decision and should not be taken lightly. For most Kiwis their family home is their largest purchase and their largest single investment. The benefits of buying well and the potential dangers of a poor choice, can be substantial and enduring.

Because of the level of potential risk most home buyers will engage the services of a professional agent, and this would certainly advisable for newly arrived migrants, however this is not a legal requirement. Once you feel you really understand the local market and are sure you have found what you want, buying a home can be completed within three or four weeks.

Where to look

It is difficult to avoid property advertising. Special property features are run in the Wednesday and Saturday editions of most major newspapers. Free publications are available from real estate companies and are often added to many newspapers, and the Real Estate Institute provides national listings at www.realestate.co.nz. There are also numerous online marketplaces for housing.

Real estate agents

Most houses are sold through real estate agents who operate on a commission paid to them by the seller. Agents will make appointments for you to see properties and they will usually also provide transport if you ask them. You may use any number of agents to search for a property, but when you decide to buy you will deal only with the agent managing the sale. For your security, agents should be members of the MREINZ. (www.reinz.co.nz)

Open homes

People who are selling their houses often hold ‘open homes’ at the weekend. This is an opportunity to visit the house and look around. ‘Open homes’ are usually open for up to two hours and anyone can come to the house during this time. Open homes are usually advertised in the same places as the houses themselves.

Borrowing money

The mortgage market in New Zealand is highly competitive and it is well worth shopping around for the best deal. A good place to start is: www.realestate.co.nz which provides an up-to-date survey of mortgage interest rates and access to a handy Mortgage Calculator.

Banks can choose the terms of the loan they offer based on the risk they believe is involved. It is very rare for loans to be made for more than 95% of a property’s sale price. The negative global financial situation in 2008 which was attributed to the United States’ property market has made most lenders more conservative.

Rates

All property owners are required to pay rates to their local area authorities, to help fund the civic activities of the area, and the amount of rates for each household is based on property value.

Property valuation

Who decides what the property is worth? The local council’s own ‘rating valuation’ or RV is calculated regularly, usually every 5 years, by independent contractors, who take into consideration the sale price of similar properties.

Central government also calculates its own Government Valuation or GV for administrative and insurance purposes. This rating is usually conservative and lower than local RV’s.

You can also get an independent valuation from a registered value. This can be useful to both the buyer and the seller as property prices can change substantially within a 5 year council ratings cycle.

Quotable Value is New Zealand’s largest valuation company, and was formed from the privatization of a former government department. They offer a range of valuations services, many of which are available on-line at www.qv.co.nz.

Legal process

House sales in New Zealand are governed by regulations to protect both parties, but it is also a free market where people can chose to conduct much of the process without consultation if they chose.

Legal action may be possible where someone has been wronged, but as with all such activities this can be a lengthy and expensive process. Every house purchaser would be well advised to wisely pay the cost of doing things right the first time.

There is competition in the market for these services, and you are entitled to know exactly what costs any agent, value, conveyancing lawyer or other service provider will charge. It is your right to be informed and to be able to compare.

Insurance

It’s important to make sure your house insurance starts on the day you take possession of the house. In some house auctions, you are responsible for insuring the house as soon as you purchase. In New Zealand, house insurance includes a level of cover for earthquake damage. You should also insure the contents of your house. Your insurance company can organise this for you.

Further information

A comprehensive list of people who can help you with all aspects of buying your own home can be found in the Living Guide (www.ssnz.govt.nz/publications/LivingGuide_all.pdf)

For a thorough introduction to house buying in New Zealand, check out this free guide from the   Department of Building and Housing (www.dbh.govt.nz/UserFiles/File/Publications/Building/consumer/home-buyers.pdf)