The Sale and Purchase Agreement (S&P) is the most important document in any New Zealand property transaction. Once you go unconditional, you're legally bound to complete the purchase — regardless of what you discover afterwards. Understanding what you're signing isn't optional. It's essential.
Below are the five red flags we see most often when reviewing S&P agreements for NZ buyers.
Red Flag #1: Vague or Missing "Subject To" Clauses
Conditions that don't protect you properly
Most S&P agreements include conditions — finance, LIM, building inspection — that give you the right to cancel if something goes wrong. The problem is in the wording.
A clause that says "subject to satisfactory finance" with no deadline or definition of "satisfactory" is dangerously vague. If a dispute arises, you may have no clear legal right to cancel.
What to check: Every condition should specify a clear deadline, what "satisfactory" means, and who decides. If your lawyer hasn't reviewed these clauses, they should.
Red Flag #2: Short Due Diligence Periods
10 working days is often not enough
Standard S&P agreements in NZ typically allow 10 working days for conditions like finance approval and building inspection. In a competitive market, vendors often push for shorter periods — sometimes as little as 5 days.
Getting a quality building inspector booked, a full LIM report from council, and finance formally approved in 5 working days is extremely difficult. If you can't complete due diligence in time, you face an uncomfortable choice: go unconditional without full information, or lose the property.
What to check: Negotiate for at least 10–15 working days for each condition. If the vendor won't budge, make sure you've already lined up your inspector and bank before you sign.
Red Flag #3: "Chattels" Lists That Are Incomplete or Misleading
What stays and what goes?
The chattels list specifies which items are included in the sale — whiteware, light fittings, heat pumps, blinds, and so on. Disputes over chattels are among the most common post-settlement complaints in NZ property transactions.
Watch for vague entries like "curtains (some)" or items listed as included that the vendor clearly intends to take (a brand-new heat pump installed last month, for example).
Also check: if a chattel is listed but missing at settlement, you have legal recourse — but only if it was clearly specified in the agreement.
What to check: Walk through the property before signing and verify every chattel on the list is physically present and in working order. Get specifics added in writing for high-value items.
Red Flag #4: No Disclosure of Leaky Building History
The leaky building crisis still affects thousands of NZ homes
Properties built between approximately 1994 and 2004 using monolithic cladding (often called "plaster homes") carry a higher risk of weathertightness issues. Remediating a leaky home can cost anywhere from $80,000 to over $300,000.
Vendors are not legally required to disclose weathertightness history unless directly asked — and even then, disclosure obligations are limited. The S&P agreement should be read alongside the LIM report and building inspection with this in mind.
What to check: If the property was built in this era, insist on a full weathertightness inspection as a separate condition. Check the LIM for any weathertightness-related claims or council records. Look for EPS foam cladding, low-pitch roofs, and parapets — common features of affected homes.
Red Flag #5: Penalty Clauses and Deposit Terms You Haven't Read
What happens if you can't settle?
The standard ADLS/REINZ S&P agreement includes a 10% deposit, typically paid within 5 working days of the agreement becoming unconditional. If you fail to settle, the vendor can retain this deposit and sue you for further damages.
In a rising market, failing to settle on a $900,000 property means a $90,000 deposit is at risk — before any legal costs. Some agreements also include penalty interest on the unpaid balance for each day settlement is delayed.
What to check: Know exactly what your deposit is, when it's due, and where it's held. Confirm with your bank that your finance approval is formal and unconditional — not just a conditional pre-approval — before going unconditional on the property.
Before signing any S&P agreement, send it to your lawyer immediately. Don't wait until just before the deadline. A good property lawyer will review the agreement, flag any unusual clauses, and negotiate amendments on your behalf — typically for a few hundred dollars that could save you far more.
How Verihome Can Help
AI won't replace your lawyer — and it shouldn't. But it can help you understand what's in your documents before you sit down with them, so you can ask the right questions.
Verihome's AI analysis tool reads your S&P agreement and identifies clauses that may need attention: unusual conditions, vague wording, missing protections, and more. It gives you a plain-English summary of the key risks so you're not going into your lawyer meeting blind.
Get Your S&P Agreement Analysed
Upload your Sale and Purchase Agreement and receive an AI-powered risk summary in minutes. Spot the issues before you sign.
Analyse My S&P Agreement →Frequently Asked Questions
Do I need a lawyer to review my S&P agreement in NZ?
You are not legally required to use a lawyer, but it is strongly recommended. Property lawyers typically charge $1,500–$2,500 for a full purchase transaction, which includes reviewing the S&P agreement. Given the sums involved, this is one of the best investments you can make.
What is the standard deposit in a NZ property purchase?
The standard deposit is 10% of the purchase price, due within 5 working days of the agreement becoming unconditional. Some vendors accept a smaller deposit (5%), particularly for new builds. The deposit is held in the real estate agent's trust account until settlement.
Can I cancel a NZ S&P agreement after going unconditional?
Once you go unconditional, you are legally bound to complete the purchase. Cancelling after this point means forfeiting your deposit and potentially being sued by the vendor for any loss they suffer if they resell at a lower price. Always consult a lawyer before attempting to cancel an unconditional agreement.
How long does it take to settle a NZ property purchase?
Settlement typically occurs 4–6 weeks after the agreement becomes unconditional, though this is negotiable. The settlement date is specified in the S&P agreement. On settlement day, your solicitor transfers the purchase funds and you receive the keys.