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Property settlements at Alert Level 2 and beyond:

FAQ's on your contract, finance, buying and selling answered.

The Government’s announcement that we will move to COVID-19 Alert Level 2 will have come as a relief to many. However, we know there is some uncertainty as to how the sale and purchase of property will look in Alert Level 2 and beyond. Below is a summary of some frequently asked questions.

Please note this guidance is still developing and the Law Society has yet to provide their opinion or comment on Alert Level 2.

Your Contract and COVID-19

My settlement date / conditions of the contract were deferred to sometime in Level 2, what date have they been shifted to?

We will now be able to calculate the settlement and condition dates that were deferred to Alert Level 2. For example, if your settlement / confirmation date was deferred to 10 working days after Alert Level 2, you will be settling / confirming on 28 May 2020. Your lawyer should be getting in touch with you regarding these dates, but you should be ready to instruct your insurer and bank / mortgage broker about the final settlement date.

Can I have professional reports carried out for my due diligence?

Many professionals and inspectors were able to return to work in Alert Level 3. With the further relaxation of restrictions in Alert Level 2, most professionals should be available to carry out the reports you need for your due diligence. We would expect demand for these professionals to have increased with the changes in Alert Levels. We recommend you contact them as soon as possible to see when they can carry out the inspections required. If they are too busy you may need to obtain an extension to your conditions.

What will happen if we go back to Level 3 or 4?

If we were to re-enter Level 3 or 4, we would expect that the issues around property transactions would look much the same as they did previously when the Alert Levels changed. The Vendor and the Purchaser will need to come to an arrangement as to the settlement and confirmation dates in the contract. As in the previous Alert Levels 4 and 3, the Government and the Property Law Council will likely give guidance on what should and should not be done during Level 3 and 4 . Your lawyers would need to advise you on that guidance and negotiate the deferrals on your behalf. For any agreements that have not yet been signed, we recommend a clause which defers settlement if we were to re-enter Level 3 or 4.

Buying and Selling In Level 2

Can we go to open homes? Can open homes be held?

Previous guidance under Alert Level 3 required house viewings to be done virtually where possible and private viewings only occurring with strict limitations around who could be at the property and how the viewing could be conducted. It appears now under Alert Level 2 that viewings, open homes, and auctions can happen (with appropriate physical distancing measures in place). We recommend you discuss this with the agent involved, as they may have special rules or policies around open homes e.g. you may need to register for an open home before arriving.

I have tenants in my property and I am looking to sell / need to settle in Alert Level 2. What are my options?

The same rules around tenants are still in place. As a reminder, if you wish to terminate the tenancy agreement solely to give vacant possession you will need to come to a mutual written agreement with your tenant. The rules around moving and viewing rental houses are relaxed even further in Alert Level 2 which may mean your tenant will be able to look for alternative accommodation. The best way to proceed is still to have an open dialogue with your tenants and try to come to a mutually beneficial arrangement. These rules are in place until late June with the Government then reassessing the rules and deciding if they need to be extended or not.  

Finance and COVID-19

What are the latest updates from banks?

Previous restrictions from the Reserve Bank meant that no more than 10 percent of banks' new lending could be to people with deposits of less than 20 percent of the house purchase price. These restrictions have been temporarily restricted by the Reserve Bank for 12 months. However, this does not guarantee you will be able to get a loan as banks have other eligibility criteria and policies you need to meet before they will lend to you. We recommend you discuss these changes with a mortgage broker or your bank in the first instance.

I had confirmed / pre approved finance before the lockdown, is it still valid?

You will need to discuss this with your mortgage broker or contact at the bank. Before the lockdown many banks would only put finance offers in place for 90 days before requiring an additional credit check, although this was usually on a case by case basis. The best approach is to discuss your concerns with your mortgage broker or contact at the bank and see if they can give you some reassurances in writing around your lending.

Can I come in to your offices to sign documents? Do I have to?

In Alert Level 2, we can begin meeting our clients face to face again in our offices. We will check your contact details with you for Contact Tracing purposes when we book a meeting with you and we will require you to follow procedures that will allow for appropriate physical distancing to keep everyone safe. Your SRB person will work with you on this screening and process.  Our policy around our interactions with you will change as we move through Alert Level 2, so please check our website and social media for up to date information. The guidance from Land Information New Zealand around witnessing important transfer documents by audio-visual conference is still in place, so for the time being we can still witness your documents remotely.  

If you have any other questions or want any clarification regarding the above, please do not hesitate to get in touch with someone in the SRB Property team.


The above information is of a general nature only. The information in this article does in no way constitute legal advice and all readers should contact a law firm for advice relating to your specific circumstances.

Chris Boivin

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.

View all posts by Chris Boivin
Mark Bond

About Mark Bond

Mark is a member of our Property Team. He assists clients with various residential and commercial property transactions, including associated company and trust structuring.

View all posts by Mark Bond
Callan Wilson

About Callan Wilson

Callan joined Saunders Robinson Brown in 2018. He is a member of our Property Team.

View all posts by Callan Wilson