Te Tāhū o te Ture - the Ministry of Justice has prepared guidance below for people and their lawyers dealing with property sales and settlements during the COVID-19 pandemic. This information will continue to be updated as needed.
The COVID-19 Alert Level System is in place to manage and minimise the risk of COVID-19 in Aotearoa New Zealand. The system helps people understand the current level of risk and the restrictions that legally must be followed. Alert Levels may be applied at a town, city, territorial local authority, regional or national level.
For up-to-date key information about COVID-19 Alert Levels and moving, selling or buying a property, see the Unite Against COVID-19 website:
Moving, buying and selling your home(external link)
You should be aware when entering a property transaction that the COVID-19 Alert Level could be increased at any time and new restrictions would apply. You should take this into account in your planning and discuss with your lawyer and real estate agent.
At COVID-19 Alert Level 4, any activity relating to property sales must only be done remotely and moving house is not allowed except in extreme circumstances.
If you are selling or buying a property and settlement was due to occur during Alert Level 4, we recommend that parties agree to delay settlement if possible. Some agreements may have a clause allowing settlement to be delayed. You should discuss this situation with your lawyer.
New sale and purchase agreements should include a clause in the agreement to delay settlement until an Alert Level is in place which allows settlements to occur. They should also contain a clause allowing for the ability to defer the confirmation dates of further terms where it is not possible to complete due diligence investigations due to an Alert Level restriction (for example, a builder’s report condition).
It may still be possible to complete a sale during Alert Level 4 where there is no movement of people, for example a rental property with tenants staying.
At COVID-19 Alert Level 4:
For further information, please visit:
Moving, buying and selling your home(external link)
Detailed information about property sales and settlements, and the conditions that must be complied with during Alert Level 4 is also available at:
REA information on conducting real estate business during Covid-19 Alert Level 4(external link)
No, at Alert Level 4, you are unable to meet with your lawyer in person at their work premises. All documents should be signed remotely in an Alert Level 4 area in order to continue limiting close physical contact. You should discuss this situation with your lawyer.
At COVID-19 Alert Level 3, it is possible to complete some property sales and settlements, and to move house, as long as certain conditions are complied with. At Alert Level 3, there is an expectation that all activity relating to property sales and settlements is carried out remotely wherever possible.
Given the restrictions that moving companies may faces at Alert Level 3, If possible, settlement should be delayed until Alert Level 2. Because Alert Levels may change, new sale and purchase agreements should include a clause to delay settlement until an Alert Level is in place which allows settlements to occur. They should also contain a clause allowing for the ability to defer the confirmation dates of further terms where it is not possible to complete due diligence investigations due to an Alert Level restriction (for example, builder’s report conditions).
At COVID-19 Alert Level 3:
For further information, please visit:
Moving, buying and selling your home(external link)
Detailed information about property sales and settlements, including the conditions that must be complied with during Alert Level 3, is also available at:
REA information on conducting real estate business during Covid-19 Alert Level 3(external link)
No, at Alert Level 3, you are unable to meet with your lawyer in person at their work premises. All documents should be signed remotely in an Alert Level 3 area in order to continue limiting close physical contact. You should discuss this situation with your lawyer.
At COVID-19 Alert Level 2, it is possible to conduct and complete property sales and settlements in person, as long as the necessary public health and physical distancing requirements are complied with.
At COVID-19 Alert Level 2:
The Law Society recommends that lawyers be given the opportunity to review contracts before they are signed.
For further information, please visit:
Moving, buying and selling your home(external link)
Detailed information about property sales and settlements, including the conditions that must be complied with during Alert Level 2, is also available at:
REA information on conducting real estate business during Covid-19 Alert Level 2(external link)
General information about property sales and settlements in light of COVID-19
You should be aware when entering a property transaction that the COVID-19 Alert Level could be increased at any time and new restrictions would apply. You should take this into account in your planning and discuss with your lawyer and real estate agent.
The sale and purchase agreement sets out what happens if one party is not able to settle. The agreement may allow one party to cancel the agreement and/or seek compensation if the other party can’t complete the sale.
It is best to get in touch with your lawyer to talk about options as soon as the Alert Level changes. Lawyers can provide advice on rights, obligations and risks and consequences of possible actions in the current, particular situation of their clients.
There are many different options. It’s important to find one that suits your particular circumstances and interests.
Every situation is unique. A lawyer is the best person to provide advice on the range of options available in your specific situation and how to go about reaching an agreement with the other party.
Finding a mutually acceptable agreement is the best approach to avoid legal disputes and court proceedings which can be time consuming, stressful and expensive.
No. There is no automatic delay. Some contracts may have a clause delaying settlement at certain Alert Levels or where both parties can’t settle. This could be the case where there are technology issues with the settlement.
Every situation is different. In most cases, both parties will want to find a way for the sale to carry on.
No. A person can’t automatically cancel a contract because of the measures being taken against COVID-19. Cancellation rights depend on the terms of the sale and purchase agreement.
The sale and purchase agreement may set out what happens if the sale cannot be completed. A lawyer would be able to provide advice on this and any other laws that may apply to your situation.
A party cancelling a contract without a proper legal basis may face significant legal consequences. For example, they might have to pay damages for breach of contract. A lawyer is the best person to provide guidance on what may happen if the parties are not able to agree on a way forward.
In all cases, it will be possible to transfer ownership electronically if there are no other problems that prevent the sale going ahead. Many lawyers and conveyancers may be working from home but will be available for their clients and have the necessary technology.
Land Information New Zealand’s (LINZ) electronic land register Landonline is still operating, enabling the registration by lawyers of relevant documents such as transfers or mortgages. Documents that are sent to LINZ by post or courier are still being accepted but processing times may be longer, as some LINZ staff are working remotely.
LINZ has updated its website bringing together a range of information about its services during the current Covid-19 Alert Level restrictions:
COVID-19: Information about LINZ services(external link)
Many people’s financial situation has changed because of COVID-19 and its consequences. For example, the value of people’s Kiwisaver funds may have reduced. A buyer cannot generally cancel their contract because of their financial position unless the contract is conditional upon finance. It is suggested that parties discuss financial issues with their lawyers, banks and the other party (for example, the seller) to come to a mutually acceptable agreement based on the individual circumstances.
You should talk to your lawyer.
You and your lawyer should discuss whether there will be an extra charge for any extra work your lawyer needs to do as a result of the response to COVID-19. You should ask your lawyer whether it will cost extra, and if so, how much. Your lawyer has a duty to charge you a fee that is fair and reasonable and let you know how and when you will be billed.
For more information, see:
Law Society 'how much will it cost' website page(external link)
The main contact for parties having issues with residential property settlements should be their lawyers or conveyancers.
You may wish to refer to the Law Society website for COVID-19 information and related guidance for law practitioners:
Law Society COVID-19 information(external link)
Parties can also contact their real estate agent if they have questions about their transaction, especially if they are at an earlier stage of the selling and buying process.
The Real Estate Authority (REA) has published some guidance for sellers and buyers and prospective sellers and buyers:
Real Estate Authority guidance for homebuyers and sellers(external link)
For information about the Government’s COVID-19 response and the Alert Levels visit:
Unite Against COVID-19(external link)
Government agencies with relevant responsibilities are:
The purpose of the response to COVID-19 is to save lives. We all need to stick to the rules of physical distancing and only move around for the specific purposes allowed under the current Alert Level.
Across the world, millions of transactions are affected in one way or other by COVID-19. Please continue to be kind, cooperate and try to find a good way forward which works for both parties considering this unprecedented situation.