How to purchase an Auckland apartment from overseas?
Purchasing an apartment from overseas is a frequent occurrence in Auckland and with sound due diligence a more than achievable task with little stress involved.
Buying from overseas does have its risks, the reason for that is due to not being on the ground and having the ability to see the apartment physically.
Factors to consider and practices that are recommended pre overseas purchases in Auckland are to have either a friend or family member or an independent rental agent who is not associated with the company who is selling the apartment to do a viewing for you. Photos cannot always be relied on.
Secondly, a building inspection is key and well worth the money.
Ensure you have a relationship with a lawyer, create this prior to purchase and make sure they are a lawyer who understands and has done many apartment sales.
Clauses in the agreement are important and protect you during the sale, if there is nothing wrong with the apartment the agent will happily add these in for you.
Lastly, the final factor to consider is getting a rental agent to assess what rent can be expected and tenants that you are likely to attract.
Andrew Murray from Apartment Specialists. Buying an Auckland apartment from overseas. How do you do it, and how do you do it properly?
Now the Auckland apartment market is booming at the moment, and the future looks very bright through the years to come. And, yes, everyone is making money. But the thing is, buying from overseas has its risks. And I see this happen time and time again where an overseas purchaser will purchase something that they may have not purchased if they were actually here. I suppose that's the best way I can say it. And the reason for that is a real state agent is in a position of trust.
Now the thing is is because you're overseas or being a buyer and you're buying overseas, you're not on that ground floor. You're not able to do the things you'd like to do if you were actually say in Auckland. So what I've done is form five steps that will ensure that your purchase is not only a profitable one but a safe one, and you're getting what you're wanting to achieve. And how you do that is by surrounding independent advisors around you.
So first of all, for number one, don't rely just on the photos. The photos may be missing certain things. So what I recommend you to do is get a friend or family member that you can trust to come and inspect the apartment for you. Now if you don't have that person in Auckland, I would engage an independent rental manager from a company that is not the company of the real estate agent to do an inspection for you and they can give a report back to you.
Now number two, get a building inspection. Now a lot of Kiwi buyers don't do this. I still think they should, but being an overseas buyer, it is mandatory. You've got to get a building inspection and the reason for that is they go through it with a fine tooth comb and yes, they may bring up small things or things that are damaged here and there but if you didn't, you're going to end up paying for it at settlement. And worst case scenario, they're going to be more likely to pick up something if there's an issue with the apartment or the complex.
Number three. Create a relationship with a lawyer. Now that's an obvious one because you're going to have to buy the apartment, but create your relationship before you purchase. The reason I'm saying that is because then they can get you advice on how to go into that purchase. Now also make sure you choose a lawyer that is experienced with the kind of apartment you're purchasing. So not only apartments, but if you're buying a leasehold apartment make sure they're experienced with leasehold apartments. But absolutely a minimum, make sure they do a lot of apartment sales because, for example a lawyer that's down in another part of the country or another part of Auckland where there's not many apartments, doesn't really have the expertise to to give you the service you need.
Now, number four, clauses in the agreement. So these are things you put in the sale and purchase agreement to give you extra protection. Now if there's nothing wrong with the apartment or nothing wrong with the complex, an agent should have no problem with putting clauses in the agreement. And these are clauses like, "This agreement is conditional upon my lawyer's approval of the last two years of body corporate minutes and maybe the formal content of this agreement, et cetera, et cetera."
Now number five is rental income. Do not rely on the rental income even that of the apartment's getting or what's on the flyer. Now yes, real estate agent will be doing it-- has to actually do it of what's realistic but for you to really rely on it, I would get an independent rental assessment from again a company that is not under the same umbrella, who is not part of the company that the real estate agent is part of.
So through those five steps, that enables you to have a pretty full-proof way of purchasing and that means you are able to purchase from overseas and be a lot more comfortable through the whole process.
Now I work for a lot of purchasers that are overseas and obviously I follow this when I'm working with them. Now it is also hard to find the right people to use, so feel free to flick me an email: [email protected] Even if you don't buy through us, I can give you a list of people who are experienced in whatever area you need and they can send it through to you.
Anyway, I hope that helps and happy purchasing. Cheers!
If you want to know more about apartment buying in Auckland, just email me at [email protected] or call +6421 424 892 and we will happily help you or connect you with the right people.