New sale and purchase agreement on its way

REINZ chief executive Christine Le Cren says the form has taken around seven months to prepare and should help all parties involved in property transactions.

Currently, the form used by the market is one jointly owned by REINZ and the Auckland District Law Society (ADLS).

Le Cren says the new form does not replace the ADLS one and it will be up to individuals to decide which one they choose to use.

She says the plain English form is clearer than the existing one and is easier to use, particularly as it has a better use of white space and less dense text.

In addition to that, it has "warnings" tick boxes designed so users can understand the consequences of what they are signing.

She says there are a few differences in some of the legal concepts, but feels they are explained better than in the ADLS form.

It helps to clarify GST issues. This is important for property investors, as well as commercial and rural property owners.

Another change is that information about reports, such as Land Information Memorandums (LIM) are now at the front of the form.

Le Cren says although there are changes in the form "it still maintains the integrity of the law"

The Law Society says when it found out about the REINZ's plans for its form, it opposed them.

It conveyed "its strong support for there being one standard real estate agreement throughout the country. However, for reasons beyond the (Property Law) section's control, this vision could not be realised."

However, it has had input into the new form and is also understood to be reviewing the ADLS form which has been the standard form for decades and is currently in its eighth edition.