Home and Income
Many people these days are looking for ways to reduce their mortgage. What better way than to have a property that can be split into two seperate dwellings.
Of course, the property will have to comply with any current building regulations and various council rules and healthy homes standards.
Sometimes when buying or selling a property it can be quite stressful if you don’t know the rules.
Consumer law and advertising”home and income” properties
Jenny was attending an open home for a friend, who wanted her to act as a ‘secret shopper’ after offering to supply a building inspection report to buyers for the sale of her property. Her friend wanted to be upfront about everything to do with her property, and thought it the best way forward.
She overheard the salesperson telling a buyer that the downstairs area was set up ready to go as a “home and Income” opportunity and that it would be a great way to pay the mortgage off.
This statement alarmed her because she remembered her friend telling her that the property could not be advertised it as “home & Income” because it did not meet or comply with the building code and standards.
So the salesperson had just misrepresented the use of the property with that one sentence.
Professional code of conduct rules and client care
In fact, the salesperson had broken several rules of the professional code of conduct and client care rules that most real estate salespeople operate under in several countries.
Read more here on the NZ rules.
Rule 6.4 relates to not misleading a customer or client, nor providing false information, nor withholding information that should by law or in fairness be provided to a customer or client.
Rule 5.2 says that the licensee must have a sound knowledge of the Act, regulations, rules issued by the Authority (including these rules), and other legislation relevant to real estate agency work.
Advertised price
Jenny received the colourful flyer that she had been handed at the front door by the salesperson.
It stated ‘Negotiable over $980,000.’
She asked the salesperson to clarify what that meant, and was shocked to be told that her friend was willing to accept a few thousand over $980,000 when she knew that she was hoping for offers well over $1m.
Rule 9.4 says that a licensee must not mislead customers as to the price expectations of the client.
On enquiring about the downstairs area, and whether her friend had managed to get the correct building consent issued, her friend confirmed again, that it was not compliant and therefore illegal.
Her friend told her that she had told the salesperson that it had been rented out in the past, and that she felt that it was worth more as a “home & income” property.
The salesperson should have done his own homework and he would have then found out that the property could not be advertised as “home and income” if it does not meet the correct building standards and comply with legislation.
In fact the salesperson could be in a spot of trouble with the Regulatory Authority. Read more here
Disclosure is a critical part of selling a property.
So if you are thinking of selling, make sure that you disclose everything that you need to disclose, and if in doubt, choose an experienced licensed salesperson to explain the pitfalls of non-disclosure.
©2024 e-propertymatters.com| women-in-realestate.com|gentlelifehacks.com|Author| Kathryn
