Property

Tighter insurance stalling real estate market

House sales are becoming impossible for real estate agents in Canterbury as home buyers get hit by tougher regulations on house insurance.

Wednesday, September 15th 2010

 

Braziers Property Investments principal Tony Brazier said the problem was with a stand-down period insurance companies had put on house policies in Canterbury.

Once a house is sold the new owner would have to wait 21 days before they were insured under new legislation. However, a bank would not finance a house without insurance.

"This totally stuffed all contracts last Friday. People ready to settle were unable to get insurance so they could not finance. It almost needs the Government to look at it to see if it is fair for the insurance companies to do that," Brazier said.

However, once the 21-day stand-down period was over a new home owner was not guaranteed insurance, as companies were wanting to see evidence the properties were structurally sound before they would insure them, he said.

"We don't yet know to what level that inspection will have to be.

"We have advised our sales people they will not be able to make sales unless they put in a building clause to say that it is approved by the council or has a certificate of inspection, but it is a bit early to say if that will be enough," Brazier said.

Insurance Council of New Zealand spokesman Terry Jordan predicted insurance companies would ease their regulations in about three to four weeks.

He said some companies had agreed to drop the 21-day stand-down period if the vendor and purchaser both had insurance. However, most companies would only approve insurance polices with extensive geo-tech reports.

"It is a problem insurers are acutely aware of. When they can gain some confidence in the market they will be able to relax the regulations."

However, there are no guarantees.

"If we get another big shake then we are back at square one."

Most Read

Unity First Home Buyer special 4.29
SBS FirstHome Combo 4.29
Co-operative Bank - First Home Special 4.85
China Construction Bank 4.85
ICBC 4.85
TSB Special 4.89
Kiwibank Special 4.89
ASB Bank 4.89
SBS Bank Special 4.89
Westpac Special 4.89
BNZ - Std 4.89
Nelson Building Society 4.93
ICBC 4.95
SBS Bank Special 4.95
China Construction Bank 4.95
Wairarapa Building Society 4.95
TSB Special 4.95
ANZ Special 4.95
ASB Bank 4.95
Kainga Ora 4.95
Westpac Special 4.95
AIA - Go Home Loans 4.95
SBS Bank Special 5.39
Westpac Special 5.39
ICBC 5.39
Co-operative Bank - Owner Occ 5.59
BNZ - Std 5.59
BNZ - Classic 5.59
AIA - Go Home Loans 5.59
ASB Bank 5.59
Kainga Ora 5.69
Kiwibank Special 5.79
ANZ 5.79
SBS Construction lending for FHB 3.94
AIA - Back My Build 4.44
CFML 321 Loans 4.99
Co-operative Bank - Owner Occ 5.95
Co-operative Bank - Standard 5.95
Heartland Bank - Online 5.99
Pepper Money Prime 6.29
Kiwibank - Offset 6.35
Kiwibank 6.35
TSB Special 6.39
Kainga Ora 6.44

More Stories

Four decades of 6-7% yearly house price growth ending

Friday, March 21st 2025

Four decades of 6-7% yearly house price growth ending

New Zealander’s reliance on property capital gains in the mid-single digits is at an end.

[TMM Podcast] Yelsa serves up “marine reserve” of property buyers

Friday, January 31st 2025

[TMM Podcast] Yelsa serves up “marine reserve” of property buyers

It’s been years in the making and former real estate agent Mike Harvey is now coming to market with his platform matching buyers and sellers, an offering he says will be a gamechanger for the industry.

Leaving last year's stumbling housing market behind

Friday, January 17th 2025

Leaving last year's stumbling housing market behind

As interest rates ease and job losses climb, New Zealand’s housing market faces a mixed year of modest growth, with conflicting forces shaping the outlook for homebuyers and investors.

Don’t bet on house prices rising faster than incomes

Wednesday, January 15th 2025

Don’t bet on house prices rising faster than incomes

Former Reserve Bank Governor and National Party leader Don Brash says there are grounds for believing that house prices may finally have ended the three-decade period when they rose significantly faster than incomes.