What do I have to disclose when selling a house in New Zealand?

What to Disclose When Selling a House in New Zealand
Disclosure is one of the most misunderstood parts of selling property in New Zealand. Some sellers over-disclose, volunteering information that reduces their sale price unnecessarily. Most sellers under-disclose, either through genuine unawareness of their obligations or through an optimistic interpretation of what ‘material’ means.
Here is the honest guide to what you need to disclose and what you don’t.

The legal framework
New Zealand property sales do not have a formal statutory disclosure regime in the same way some other jurisdictions do. However, sellers have obligations under general contract law. Specifically, the duty not to misrepresent or mislead, and under the sale and purchase agreement process.
The standard ADLS/REINZ Sale and Purchase Agreement includes a vendor warranty that the seller is not aware of any matter that may materially affect the value of the property or the buyer’s decision to purchase that has not been disclosed.
That warranty creates a clear legal obligation.

What ‘material’ means in practice
A material defect or issue is one that would be likely to affect a reasonable buyer’s decision to purchase or the price they would be willing to pay. The test is objective, would a reasonable person consider this information significant?

Things that are clearly material: known structural defects, previous or current leaks, weathertight issues, unconsented work, flood damage, significant pest infestation, meth contamination, boundary disputes, easements that significantly affect use, and any known issues with the title or consent history.

Things that are generally not required to be disclosed: general wear and tear consistent with the age of the property, cosmetic issues that are visible to any buyer on inspection, and matters that would be apparent to a competent building inspector.

The weathertight and leaky building issue
Given New Zealand’s experience with leaky building syndrome, weathertight history is a particularly sensitive disclosure area. If your property has had weathertight issues, even if they have been repaired, this is generally considered material and should be disclosed.
A buyer who discovers a concealed weathertight history after purchase has a strong case for misrepresentation.
If your property was repaired under the Weathertight Homes Resolution Services (WHRS) process, or if any weathertight claims were made against it, these should be disclosed.
The documentation of the repair and its scope should be available to provide to buyers.

Unconsented work
Unconsented work is one of the most common disclosure issues in New Zealand residential sales. Decks, garages, sleep-outs, extensions, plumbing and drainage alterations completed without council consent are not automatically dangerous or problematic, but they need to be disclosed.
The LIM will often reveal consent absences where buyers expect to see documentation. Getting ahead of this by disclosing known unconsented work, and where possible, obtaining a cost estimate for regularisation to provide to buyers, is a significantly stronger approach than hoping buyers don’t notice.

Neighbours and neighbourhood issues
The obligation to disclose does not generally extend to subjective matters like neighbour relationships. However, if there is an active and documented dispute with a neighbour, a formal boundary dispute, a noise complaint lodged with the council, a right-of-way conflict, then this is likely material and should be disclosed.

The honest approach: and why it protects you
The sellers who get into trouble with disclosure are almost always the ones who knew about a significant issue and chose not to mention it. Post-sale claims for non-disclosure and misrepresentation are increasingly common in New Zealand, and they are costly in time, money, and stress.

The practical approach: if you know about something and you are asking yourself ‘do I have to disclose this?’ - the answer is almost certainly yes.
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Work with your agent and lawyer to understand how to frame the disclosure appropriately. Disclosures that are clear, accompanied by relevant documentation, and contextualised properly do significantly less damage to sale price than buyers discovering issues independently.

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If you’re asking what you have to disclose when selling a house in New Zealand, Paul Sumich is a Whangarei-based real estate professional who publishes honest pre-sale guidance for New Zealand home sellers. Find more at paulsumich.co.nz/blog