Lifestyle Properties - Time for a New Outlook?
We think New Zealand has the best scenery in the world, so it is no surprise that living on a lifestyle property is such an attractive option for many. But with that new view come some additional complexities. Here are some of the key things to consider when purchasing a lifestyle property:
- GST: This is a common pitfall and we recommend you obtain legal advice before signing an agreement. If the vendor is registered for GST, registering for GST may seem a great way to save money or get a cash injection through a refund however most experts agree that unless you will be running a business or taxable activity, you should avoid registering. This can also put you in a difficult position when wanting to sell.
- Being aware of the Council’s current planning rules and existing consents on the property and neighbouring properties, to ensure you can carry out your intended activities on the land.
- Water supply and knowing that your intended use (for example domestic use; stock watering or irrigation) is permitted. You will need to understand where your water comes from, the rules relating to its use and the quality of the water.
- Most rural properties rely on a septic tank and it is important to understand how these have been serviced and maintained. A poorly maintained septic tank can not only be costly, but pose serious health risks.
- Obtaining the correct insurance and making sure that risks specific to lifestyle blocks are covered.
- There are usually land covenants registered over the title that cover the type of structures you can erect on the land, and your use of the land. These will need to be carefully reviewed so your intended use is permitted.
- Understanding any easements that affect the property such as rights to convey water or rights of way.
- Ensuring building permits and consents are in place for the house and ancillary buildings such as sheds and barns.
The above points are just some of the many issues that you need to consider and discuss with your professional advisors when purchasing a lifestyle property. We recommend obtaining legal advice at an early stage and our experienced rural property specialists at Saunders Robinson Brown are happy to assist.
The above information is of a general nature only. You should contact our firm for advice relating to your specific circumstance.
About Chris Boivin
Chris is a Partner advising clients on a wide range of matters. He assists with both commercial, rural and residential property matters, as well as business transactions and asset planning.