Pre Settlement Inspection NZ: NZ Guide, Requirements and Practical Information

Buying a home involves weeks of paperwork, then one last walk through the property before the money moves. That walk-through is the pre settlement inspection. It is a short visit with a narrow job, and buyers who treat it as a casual look around often miss the point entirely.

This guide explains what the inspection is for, when it should happen, what the seller is expected to hand over, and what to do if you find a problem. It draws on guidance from the Real Estate Authority (REA) through Settled.govt.nz, Consumer Protection, and MBIE. It is general information only. Your own agreement and your lawyer or conveyancer govern your purchase.

Quick answer: what is a pre settlement inspection?

A pre settlement inspection is your final check that the property and the chattels included in the sale are in the same condition they were in when you signed the sale and purchase agreement, and that the seller has done anything they agreed to do in that agreement.

Settled.govt.nz, the REA buyer guidance site, puts the timing clearly. Arrange the inspection through the agent at least 2 working days before the settlement date, so there is time to sort out any issue you find.

Three points catch buyers out:

• It is not a second building inspection. Problems that were already there when you signed are not the seller’s to fix at this stage.
• Chattels listed in the agreement should be present and in good working order, unless you and the seller have agreed something different and recorded it.
• If you find new damage or a missing chattel, contact your lawyer or conveyancer straight away. Do not wait until settlement morning.

If finance is still being finalised, our guide to how much you can borrow in NZ covers the borrowing side. Lending and inspection run on separate tracks, and both need to be ready before settlement day.

What the inspection is, and what it is not

Consumer Protection describes this stage in simple terms: the buyer inspects the property to confirm it is in the same state as when they signed the agreement. That comparison is the whole test. You are not reassessing the house, as you did at the open home or in a pre purchase building report. You are checking for change: damage, removals, unfinished promised work, and chattels that no longer work.

When it happens and how to arrange it

Contact the real estate agent to arrange the inspection at least 2 working days before settlement. That buffer matters. Inspect the day before and find a broken window, and there is almost no time to arrange a repair, agree a price adjustment, or get instructions through two sets of lawyers.

Build the visit into your settlement week:

1. Confirm the date and time with the agent well in advance.
2. Take a copy of the sale and purchase agreement, including the chattels list and any special conditions.
3. Take dated photos or video as you go, to help your lawyer describe any issue to the seller’s lawyer.
4. Allow enough time to test things properly.
5. Call your lawyer or conveyancer the same day if anything is wrong, and follow up in writing.

If the property is tenanted, allow extra time. The seller needs the tenant’s agreement to the inspection and must give the tenant reasonable notice.

Cleanliness also catches buyers out. A house can be in the same condition as at signing and still not be as clean as you hoped. Settled notes that if a clean home matters to you, you can deal with it in the agreement, for example with a condition that the house be commercially cleaned. If your agreement says nothing about cleaning, the inspection is not the place to invent that requirement.

What the seller must deliver

Your agreement sets the baseline. By settlement, subject to what your agreement says, the seller is expected to deliver the following.

The property in the same condition as at signing

The house, land and fixtures should be as they were when the agreement was signed. New damage is the seller’s problem to address. Existing wear that you bought with the house is not. Settled gives examples of new damage to look for: storm or earthquake damage since signing, and damage done while the previous occupants moved out. A gouge in a hallway wall from a removal trolley counts. A scuff that was there at the open home does not.

Chattels present and in working order

Chattels are the movable items included in the sale and listed in the agreement, such as the stove, fixed floor coverings, blinds, curtains, light fittings and whiteware. Every listed chattel should still be in the property, and in good working order, unless a different arrangement has been agreed and documented. A dishwasher swapped for a cheaper, older model is not the same chattel in the same condition. Neither is a missing heat pump remote, or a stove element that no longer heats. Settled also suggests checking that fixtures such as lights work.

Agreed work completed

If the seller agreed in the agreement to do maintenance or repairs before settlement, check that work closely against the wording of the condition, item by item. This is the one area where you are looking for improvement since signing, rather than sameness. Raise partial or poorly done work with your lawyer promptly.

Belongings and rubbish removed

Unless the agreement says otherwise, the previous occupant’s belongings and rubbish should be gone, including from the garage, sheds and garden. Anything left behind becomes your cost to remove after settlement, so flag it before settlement.

Vacant possession, if that is what you bought

Check what your agreement promises about possession. If you bought with vacant possession, the property should be empty of occupants on settlement, apart from any tenancy your agreement specifically preserves. The REA sale and purchase agreement guide explains that where the buyer requires vacant possession, it is the seller’s responsibility to give the tenant notice to leave in line with the tenant’s legal rights. If a tenancy continues instead, you step into the role of landlord at settlement. See the tenancy section below.

Keys, remotes and alarm codes ready for settlement day

Settled advises buyers to confirm that all keys, garage door remotes and security alarm codes are accounted for and will be available on settlement day, when the seller must hand over all keys, including window lock keys. Ask specifically about letterbox keys, shed keys and spare remotes, rather than discovering a single front door key at handover.

The room by room checklist

Work through the property in a set order so nothing is skipped. Start outside, then move room by room, testing as you go.

Before you arrive

• Sale and purchase agreement, with the chattels list and conditions highlighted.
• Phone charged, for photos, video and torch. Notes or photos from earlier viewings or your building report, for comparison.
• A list of any work the seller agreed to complete.

Outside, garage and grounds

• New damage to fences, gates, driveways, paths and exterior walls since signing.
• Garage door opens and closes. Count the remotes. Test exterior lights.
• Garage, carport and sheds clear of the seller’s belongings and rubbish, unless your agreement says items are staying.
• Plants and outdoor items included in the sale still present. No rubbish or building waste left behind. Letterbox opens.

Entrance, hallway and living areas

• Exterior doors lock and unlock. Windows open, close and latch, with no newly cracked panes.
• Lights and power points work in each room.
• Walls, ceilings and floors: look for fresh holes, stains, water marks, carpet burns or tears.
• Heating included in the sale works. For a heat pump, check it heats and cools and the remote is there.
• Listed curtains and blinds present and operating. Alarm tested, with the code to be supplied at settlement.

Kitchen

The kitchen holds the most chattels, so slow down here.

• Oven and each hob element or burner heat. Rangehood and its light work.
• Dishwasher powers on and, if time allows, runs a short cycle without leaking. Look under the sink for fresh leaks.
• Hot and cold taps run, hot water arrives, and the sink drains freely.
• Cupboards and drawers empty and undamaged.
• Any listed fridge, freezer or other whiteware is the exact item agreed, switched on and cooling.

Bathrooms, toilets and laundry

• Taps and showers run with no new leaks. Look under vanities for dampness.
• Every toilet flushes, fills and stops, with no constant running.
• Extractor fans work. Hot water is actually hot, and the cylinder area shows no leaks.
• No new damage to tiles, glass, mirrors or shower doors.
• Laundry tub taps run and drain. Any included washing machine or dryer is present, and tested on a short cycle if practical.

Bedrooms

• Lights, power points and fixed heating work. Wardrobes empty, with doors running properly.
• Windows latch, and listed curtains or blinds are present.
• Carpet and walls checked for new stains or damage, especially where furniture has been moved out.

Damage hidden under a seller’s rug or dresser at the open home needs careful handling. If it was there at signing, it will generally be treated as part of the condition you bought. If furniture removal caused it, that is new damage. Your lawyer can advise on borderline cases.

Final checks before you leave

• Photograph the power meter reading, to help set up your own power account.
• Confirm the count of keys, remotes and alarm codes for settlement day.
• Photograph anything you are raising as an issue, wide shot and close up.
• Note anything you could not test, for example an appliance you could not run because the power was off, and tell your lawyer.

For wider protection once you own the place, see our guide to house insurance in NZ. Your lender will usually require cover to be in place from settlement.

Defect the seller must fix, or wear and tear you bought?

This is where most arguments happen, so it helps to think in three groups.

Group one: new damage or loss since signing. A window broken last week, a wall damaged during the move, a listed chattel removed or no longer working, storm damage to the roof. These are the core of the inspection. Raise them immediately through your lawyer.

Group two: work the seller promised and has not done properly. If a repair, replacement or removal is required by the agreement and the work is missing or incomplete, that is also a settlement issue for your lawyer.

Group three: the condition you bought. A worn carpet, a tired paint job, an oven that was already slow when you viewed the house. If it was like that when you signed, the inspection does not create a right to have it fixed. Consumer Protection notes that problems are easiest to fix before you go unconditional or before you settle, and more costly after settlement.

A practical test helps. Can you point to a change since signing, or to a promise in the agreement that has not been kept? If yes, raise it with your lawyer. If the house is exactly as it was, only emptier, it is almost certainly group three.

One grey area: an issue that existed at signing but was genuinely hidden, for example damage concealed behind furniture. Official guidance gives no simple rule for that situation. Photograph it and get legal advice before settlement.

If something is wrong: what happens next

Act the same day. Contact your lawyer or conveyancer immediately, explain what you found, and send photos. Settled is direct on this step: your lawyer or conveyancer will set out your options and can negotiate with the seller’s lawyer or conveyancer to put the situation right.

Settled describes two common outcomes. The seller fixes the damage straight away, before settlement. Or the seller agrees that the cost of fixing the issue is deducted from the final payment. Which outcome fits, and how any deduction is calculated or held, is negotiated between the lawyers based on your agreement. Do not assume you can simply withhold an amount of your own choosing without that agreement being reached. Get any arrangement recorded through your lawyer.

Two wider points from Settled matter here. If there is significant damage, or a condition in the agreement has not been met, the buyer may be entitled to compensation from the seller. Timing also cuts both ways: if you do not complete your side of the deal on the due date, and the seller can show they were able and willing to complete theirs, you may have to pay compensation to the seller under your agreement. Settled further notes that while an issue remains unresolved, the property does not officially change ownership and you do not need to make the final payment. Treat that as a reason to involve your lawyer early, not as a tactic.

Protect yourself with three habits. Put every issue in writing to your lawyer the day you find it, even if you have already phoned. Keep repair quotes if your lawyer asks for them, because a deduction discussion goes faster with a real figure. And if the seller agrees to fix something, ask your lawyer whether you should re inspect to confirm the work.

Buyers weighing a last minute problem against the wider purchase can revisit the numbers in our home loan rates guide alongside their settlement statement, so a deduction does not create confusion about the final amount payable.

New builds and buying off the plans

An inspection on a brand new home looks different, because there was no lived in house to compare against when you signed. You are usually checking the finished home against the plans, specifications and inclusions in your contract, shortly before settlement or handover. Walk through with the contract in hand, list anything unfinished or not matching, and give that list to your lawyer and to the builder promptly and in writing. What counts as complete, and what happens with defects found at handover, depends on that contract, so read those parts before the walk-through.

The other protection is the Building Act 2004, explained by MBIE through Building.govt.nz. For residential building work, the Act provides implied warranties that apply for up to 10 years from completion, whether or not you have a written contract, regardless of the cost of the project. A builder cannot contract out of them. They cover matters such as work being done properly and competently, in line with the building consent and the Building Code, and with suitable materials.

Alongside those warranties sits a 12 month defect repair period. If a defect appears within 12 months of the completion date, and you notify the contractor in writing within that period, the contractor must put it right within a reasonable timeframe. If there is a dispute during that first 12 months, it is the contractor’s responsibility to show the defect is not their fault, including work by subcontractors or products they supplied. Once the period ends, the implied warranties still run for up to 10 years, but the burden shifts: the owner then has to show the work is defective if the contractor disputes it.

In practice: get the completion date confirmed in writing, so the start of the 12 month period is clear. Notify defects in writing and keep copies. At completion, the contractor must supply certain documents regardless of the size of the job, including copies of current insurance policies for the work, guarantees or warranties for materials or services used (including how to claim and whether they can be transferred), and maintenance information needed to meet the Building Code or protect a warranty. Check you receive that package at handover. MBIE’s guidance on tolerances, materials and workmanship helps separate a genuine defect from an acceptable tolerance where you and the builder disagree.

One caution. New build rules have been under reform discussion, including proposals for mandatory home warranties for some new homes. Proposals are not the law today. Rely on your contract and the Building Act protections above.

Tenanted properties

Tenancies change the inspection in two ways: access, and whether the inspection happens at all.

If the property is sold with a tenancy that will continue after you take over, Settled says the buyer may not be entitled to a pre settlement inspection. You are buying a tenanted investment and the occupants are staying. Read your agreement to see what access, if any, it provides.

If the tenancy will end before or on settlement day, the buyer should have the right to an inspection. The seller still needs the tenant’s consent to show you through, and must give the tenant a reasonable amount of notice.

If you are buying with vacant possession, the REA guide position is that giving the tenant notice to leave, in line with the tenant’s legal rights, is the seller’s responsibility. Do not assume a tenanted house will simply be empty on settlement day. Confirm the possession position in your agreement and check it again at the inspection if access is available. If the tenancy continues and you become the landlord, also confirm how the bond and any rent paid in advance will be handled.

You can browse more property guides in our real estate category.

Frequently asked questions

Is a pre settlement inspection a legal right in NZ?

Settled describes the agreement as providing the chance to check the property and chattels before settlement, arranged through the agent at least 2 working days before settlement. Your exact rights, including visits and notice, come from your own agreement. Ask your lawyer to point to the relevant wording before you rely on it.

What if the house is dirty at the inspection?

Dirt alone is not damage or a change in condition. Unless your agreement includes a cleaning condition, a messy house may still meet the seller’s obligations. Rubbish or belongings left behind are different, and worth raising specifically.

The seller swapped an appliance for a different one. Is that allowed?

A listed chattel should be present and in good working order, unless a change has been agreed and documented. Raise an undocumented swap with your lawyer immediately, with photos of what is installed and what your agreement lists.

Can I delay settlement if I find a problem?

Do not decide that on your own. Settled notes that unresolved issues can affect whether ownership changes and whether the final payment must be made, but a buyer who fails to complete on the due date may owe the seller compensation if the seller was ready to settle. Your lawyer must handle any delay formally.

Does the inspection apply to a new build?

Yes, but the comparison is different. You compare the finished home with the plans, specifications and inclusions in your contract. Building Act protections then continue after handover: a 12 month defect repair period for defects notified in writing, and implied warranties for up to 10 years.

What if the property is tenanted and I cannot get in?

That can be correct, depending on your agreement. If the tenancy continues, Settled says the buyer may not be entitled to an inspection. If the tenancy ends before or on settlement day, the buyer should have the right to inspect, subject to the tenant’s consent and reasonable notice.

Sources

• Settled.govt.nz (Real Estate Authority), Planning for settlement day when buying. Timing, what to check, and what to do if you find an issue: https://www.settled.govt.nz/buying-a-home/settling-and-moving-in/planning-for-settlement-day-when-buying/
• Settled.govt.nz (Real Estate Authority), Planning for settlement day when selling. Seller side guidance on the inspection, compensation and tenancies: https://www.settled.govt.nz/selling-a-home/settling-and-moving-out/planning-for-settlement-day-when-selling/
• Settled.govt.nz (Real Estate Authority), Settling on settlement day when buying. How payment, title transfer and key release work on the day: https://www.settled.govt.nz/buying-a-home/settling-and-moving-in/settling-on-settlement-day-when-buying/
• Settled.govt.nz (Real Estate Authority), How to sell a tenanted property. Tenancy and inspection position where a property is tenanted: https://www.settled.govt.nz/blog/how-to-sell-a-tenanted-property/
• Consumer Protection (MBIE), Solving issues with the owner or real estate agent. Stages of buying, including the pre settlement inspection, and why problems are easier to fix before settlement: https://www.consumerprotection.govt.nz/help-product-service/buying-or-renting-a-house/solving-issues-owner-real-estate-agent
• Consumer Protection (MBIE), Working with a lawyer or conveyancer. Role of your lawyer from agreement review through to settlement day: https://www.consumerprotection.govt.nz/help-product-service/buying-or-renting-a-house/working-with-lawyer-conveyancer
• Building.govt.nz (MBIE), Protection for homeowners. Consumer protections for residential building work, including the 12 month defect repair period and 10 year implied warranties: https://www.building.govt.nz/getting-started/your-rights-and-obligations/homeowner-rights-and-obligations/know-your-rights-consumers/protection-for-homeowners
• Building.govt.nz (MBIE), Implied warranties and defects. How the defect repair period and implied warranties work in practice: https://www.building.govt.nz/projects-and-consents/why-contracts-are-valuable/implied-warranties-and-defects
• Real Estate Authority, New Zealand Residential Property Sale and Purchase Agreement Guide. Official guide to the agreement, including vacant possession and tenanted property: https://www.rea.govt.nz/assets/2024-Uploads/Blind-low-vision-guides-/L17904-REA-NZ-Residential-Property-Sale-and-Purchase-Agreement-Guide-Large-Print.pdf