To start the new year off we wanted to let you know about two new pieces of legislation that affect all property purchases made in New Zealand.
Overseas Investment Amendment Act 2018
On 22 October 2018, new restrictions on foreign investment in New Zealand housing came into force. The amendment relates primarily to preventing certain overseas people (i.e. someone who is not a NZ citizen nor ordinarily resident in NZ) from buying residential or lifestyle property in New Zealand.
It is now mandatory for purchasers, when making an offer on a property, to complete a Residential Land Statement indicating that they are eligible to purchase property under the Overseas Investment Act 2005. If it’s established that it’s likely you need consent to buy, then it’s important that you consult with your solicitor before you sign a sale and purchase agreement. If you’re unsure where you stand, contact us for an informal chat, or both.
Anti-Money Laundering and Countering Financing of Terrorism (AML/CFT) Amendment Act 2017
As real estate agents, we are at risk of being exploited by criminals to launder money. Therefore, commencing 1 January 2019, we will need to comply with the AML/CFT Act when we represent someone who is selling real estate. The following information is taken from the Justice Department website and outlines the steps we need to take to comply with the Act, that will affect people looking to sell real estate with a real estate agent:
- Verify the identity of clients looking to sell a property (obtain documents confirming names, birthdates and addresses).
- Submit a Prescribed Transaction Report to the Police Financial Intelligence Unit (FIU) if a client wants to conduct a transaction in cash that is $10,000 or more, or an international wire transfer of $1000 or more.
- Monitor customers’ accounts to identify potential warning signs of money laundering and terrorism financing. We must report any suspicious transactions or activity to the FIU.
- Submit an annual report to the Department of Internal Affairs, which will supervise our sector.
Please don’t be offended when we ask you to verify your identity. These measures are designed to deter criminals or help detect them if they do use our services.n
Images:
‘Foreign Investment in Housing’ by Pexels.