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Going out on a LIM - don't jump too soon!
So you have found the perfect house, in the loveliest neighbourhood, in the correct school zone, and you can just picture yourself sipping tea on the front porch for years and years to come. Your only issue is that front porch in question appears to be sinking in one corner… What to do?
In the flurry of falling in love with your potential new home it can be easy to be swept away, your rose-tinted glasses ignoring the sinking timber – before you know it you’ve shouted out “I’ll take it!” and there is champagne all around. Wait! Before you get that far, take off your rosy shades for a second and request a LIM report.
By law, every local Council in New Zealand keeps a file on every house in its district. This file contains both historical and contemporary information about the land and the buildings upon it, including what the land was previously used for, valuation data, yearly rates payable for the property, and details of building consents for any work done during its lifetime – and so much more! A LIM report, formally known as a ‘Land Information Memorandum,’ is a summary of all the content held in that file.
But why do I need one?
Buying a house is an enormous investment so you should make sure you know what you’re buying!
A LIM report can be very useful in helping you decide whether or not a property is worth buying. Your LIM can tell you stuff like whether the building had permits for all building work, what sort of zoning it has, whether it is free from any restrictions, what local developments may affect the property, and whether your intended use of the land is feasible.
The information contained in the LIM can hugely impact the way you perceive the house’s value: if the land has a history of flooding or subsidence, the apparent sinking deck will suddenly be a far more pressing issue. Or if the house has a killer view of the ocean which you’ve fallen in love with but resource consent has been issued for an apartment building which will block that entire view, the house may no longer appear so attractive. The only way you will know these things is by getting a LIM!
Okay, I’ve requested a LIM, now what?
There will be a cost for getting a LIM report – this varies a lot between Councils but is generally between $150 and $400. Give your local Council a ring to know how much you will have to pay.
Once you have received your LIM report you should get your lawyers to check it over. Their experience in working with these documents can put your mind at rest as they will pick up anything you may have missed and can explain the entire document to you so you know exactly what you’re buying. If the ‘sinking deck’ turns out to be no more than an architectural feature, your lawyer will let you know!
Disclaimer: The information on this page is general information only and must not be relied on as legal advice. Legal Beagle is not a law firm or a substitute for a law firm. We are unable to provide any kind of advice, explanation, opinion, or recommendation about possible legal rights, remedies, defences, options, selection of legal documents or strategies.
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