• Cavell Leitch

COVID -19 - Buying and selling houses under Level 2 and Level 3

David Fitchett - Partner, Property


Natalie Lamborn - Property Team Manager


In this article we answer several common questions as to how buying and selling properties works during both Alert Level 2 and Alert Level 3.


Can a property be marketed for sale?


Alert Level 2 – Yes, real estate agents are able to operate in full and market a property as long as the requirements for gatherings, hygiene, physical distancing and contact tracing are followed.

Alert Level 3 - Yes, real estate agents are allowed to market properties. Agents will not be able to open their offices to clients or the public, however in many cases much of the sale and purchase process can be carried out remotely as we will discuss below.


Are open homes allowed?


Alert Level 2 – Yes, open homes will be allowed as long as the requirements for gatherings, hygiene, physical distancing and contact tracing are followed.


Alert Level 3 - Agents are not allowed to run open homes and where possible should show all properties online to prospective purchasers.  Private viewings can be arranged but you will need to check this with the agent first.


Will auctions be running?


Alert Level 2 – Auctions are allowed at level 2 on the basis that no more than 100 people attend the auction however you also need to take into account physical distancing and ensure that you can maintain a 2m distance between each person attending.  Your details must also be recorded for contact tracing purposes.


Alert Level 3 - Prospective buyers will not be allowed to attend auctions in person, however real estate agents are able to run auctions virtually via online video or phone.

Sellers will also have other options instead of auctions such as deadline sales, price by negotiation and offer and acceptance via pricing a property.


How can sale and purchase agreements be signed?


Alert Level 2 – Both the Vendor and Purchaser can meet in person to sign the contract as long as you abide by the guidelines for hygiene, contact tracing and 2m distancing.  It is important that your lawyer reviews the contract before you sign (if possible) to ensure that there is a clause inserted to address how settlement will occur if the alert level changes.


Alert Level 3 - Face to face meetings are not allowed and so any contracts will need to be signed remotely. The real estate agent or your lawyer at Cavell Leitch  will be able to present you with a number of options which allow you to sign the necessary documents from the comfort of your own home.  For example, the ability of couriers to take on ‘non-essential’ business presents another option for clients who don’t have access to a printer or scanner at home.


Again, please ensure where possible that your lawyer can review the contract to ensure the appropriate clauses are added.


Can contracts go unconditional?


Alert Level 2 – Yes contracts are still able to be confirmed and go unconditional under level 2.  This will be more than likely done over the phone or via email as there is no need for you to see your lawyer to confirm your contract.  This will then ensure that all guidelines for level 2 are met.


Property inspectors, builders, valuers, engineers and other tradespeople are able to carry out site visits at any time with the consent of the Vendor and Tenants (if applicable) as long as they are complying with the health requirements for level 2.


Alert Level 3 - Cavell Leitch will still be able to order copies of the title documents and the Council’s LIM report during all Alert Level stages and then review these for you. We won’t be able to meet with you face to face during level 3, but we can email our reports to you and also discuss our findings by phone or video calls.


Banks and insurers also remain operating during all Alert Levels and are able to process finance and insurance applications. Due to the current circumstances it may be that applications take a little longer to process than they would normally, so please talk to the agent and your lawyer about making sure you allow yourself enough time.


It is important to note however, that purchasers who are new customers of a bank may not be able to obtain loan documents until they are able to have a face to face meeting with their bank.  They can still progress their finance application, however banks have advised that they will not send loan documents to lawyers until that face to face meeting has happened. Builders, valuers and other experts are also allowed to attend properties to undertake building and contamination inspections under Alert Level 3 if they follow strict hygiene and social distancing requirements.


Can I move homes?


Alert Level 2 – Buyers and sellers are able to move homes, even if that means moving regions. 


Alert Level 3 - Shifting houses is allowed provided you are undertaking a ‘permanent’ move (i.e. going to stay with some friends for a few weeks is still not allowed). You are also allowed to move between regions as required.


Moving companies are also operational under Alert Level 3.


Can property settlements be completed?


Alert Level 2 – Settlements can be completed and pre-settlement inspections carried out on the basis that the health requirements are met by the agent and the purchaser and contact tracing has been completed by all involved.


Alert Level 3 - Settlements can be completed under Alert Level 3. Pre-settlement inspections will also be able to occur again as long as the health requirements are met by everyone and contact tracing has been completed.  If the property is tenanted, the approval of the tenant is also needed.


Any documents necessary for settlement will need to be signed remotely as physical meetings with your lawyer and bank will not be allowed. We can discuss how this would work for you. For example, the ability of couriers to take on ‘non-essential’ business presents another option for clients who don’t have access to a printer or scanner at home.


Our advice for now


Cavell Leitch experts are happy to assist both vendors and purchasers (as well as agents) with their queries about buying and selling.  New Zealand’s property market is moving into an interesting period where there will be opportunities but also complexities for buyers and sellers to overcome.


We are ready to assist you with your specific situation. Please contact a member of Cavell Leitch’s property team for assistance.


Disclaimer: as this is an ever-evolving situation, our summary of the legal position is subject to change. For updates please contact a member of Cavell Leitch’s property team

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111 Cashel Mall
Christchurch 8011

PO Box 799
Christchurch 8140

Telephone: +64 3 379 9940

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