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Getting a Good Deal: A Negotiation-Lawyer’s Guide to Buying Residential Property in New Zealand

This is general information, not legal advice. For guidance on your situation, contact us directly.


There is no such thing, when it comes to buying property, as “good” or “bad” properties. There are only good or bad deals.  Two factors typically make a deal a good deal:

  1. Paying a good price relative to the market value (taking into account the likely direction of the market);

  2. Not acquiring any “risk” that you haven’t accurately priced – whether that risk is legal (title, covenants, unit title rules), financial (finance conditions, valuations gaps), or physical (defects, insurance exclusions).


In our experience, you are likely to make (or lose) more on a transaction than you’re likely to make from “adding value” through DIY improvements or timing the market. While relatively low-cost improvements (like painting and landscaping) can deliver outsized returns if they enhance appeal and create competition, the market generally efficient at pricing improvements. It is difficult, if not impossible, to predict market cycles and time in the market beats timing the market is a good rule of thumb.


Good deals on the other hand, are a statistical certainty. Average sale prices are just that: averages. In any given market there will be sales that are under and over depending on timing, competition, and how desperate a given vendor is to sell. Auckland’s median sale price is about $975k. ±20% is a $390k swing. To save that, you’d need to invest about $2,600/month (30% of the median Auckland after-tax household income) for 10 years at 5%. There will always be good deals; the trick is to make sure your deal is one of them.


Tips for getting a good deal


1) Have your finance sorted

Ideally you want to have pre-approved finance in place as early in the process as possible. If you can’t get finance in place and have to make conditional offers you are at a disadvantage. Cash offers can often get a premium because it’s less risk for vendors. Getting pre-approved finance in place also helps you narrow down the areas and properties you can realistically consider.


In our experience engaging directly with banks can streamline the application process, as you will generally be completing the same steps whether working through a broker or directly. Mortgage brokers can be valuable, particularly if you are less familiar with lending processes, have complex financial circumstances, or would appreciate additional guidance. They can help coordinate applications and provide insight into bank requirements. However, it is important to understand that brokers typically facilitate the process rather than negotiate preferential terms on your behalf; your application still goes to the bank’s credit team for assessment.


If finance is required, this will impose conditions on the purchase. Paying significantly above or below the bank’s valuation may necessitate a registered valuation, though in some cases, this can be discussed with the bank if there is strong supporting justification. Properties sold “as is where is” or those that cannot be insured are generally not eligible for bank lending and can typically be excluded from consideration.


2) Work out what you want to buy

At the start of the property-buying journey, it can be helpful to maintain an open mind and consider a broad range of potential locations. However, it is generally advantageous to focus on a specific area and property profile as early as possible. This allows you to develop a clear understanding of values, risks, and potential opportunities.


When assessing areas, consider:

  • the areas you can realistically afford;

  • Commute times if you intend to occupy, or accessibility and management convenience if purchasing as an investment;

  • School zones, particularly if you have or plan to have children;

  • Availability of public amenities and desirable geographic features;

  • Planned public infrastructure and development (information is publicly available in council planning documents);

  • Presence of public housing;

  • Proximity to the city centre or satellite hubs, which can serve as a proxy for long-term capital gain;

  • Data on long-term growth projections;

  • Indicators of gentrification, such as proximity to affluent neighbourhoods or emerging artistic/bohemian communities.


Once an area meets your criteria and budget, it is generally prudent to narrow your search to properties within that area. Focusing your search in this way allows you to quickly develop a nuanced understanding of the local market and reduces time spent on due diligence.


Next, define the type of property that aligns with your objectives.

Identify your non-negotiable property features—such as the number of bedrooms, garaging, bathrooms, or outdoor space—and prioritise those that are most important to your objectives. Document these preferences to guide your search.


If purchasing a property to occupy, consider one that you are comfortable living in for the medium term. Every sale incurs transaction costs, and frequent moves can erode potential gains. While it remains possible to profit from upgrading a primary residence, a buy-and-hold strategy is generally more prudent, allowing subsequent acquisitions to be approached strategically.


Once your preferred location and property profile are defined, the process becomes largely a numbers game. Monitor new listings that meet your criteria, conduct thorough due diligence, and make offers that reflect your assessment of value. Persistence and careful evaluation will increase the likelihood of securing a favourable transaction.


3) Conduct Due Diligence

You will have already undertaken some preliminary due diligence in selecting your target area, including considerations such as school zones, planned infrastructure, public housing, and nearby developments.


When evaluating a specific property, it is important to conduct a systematic review to identify any material issues or opportunities.


Key steps include:

  • Flooding and overland flow paths: Confirm whether the property is affected. This information is publicly available, for example, on Geomaps.

  • LIM report and title check: Verify that the title is clean and free from unusual easements or encumbrances. If there is any uncertainty, seek professional advice.

  • Zoning and development risk: Ensure that the property’s attributes, such as views or open space, are not likely to be diminished by future development. Consider the impact of nearby construction, including potential townhouses or other developments.

  • Site characteristics: Assess the land’s topography and stability. Steep hills, cliffs, or retaining walls may require ongoing maintenance or remedial work.

  • Vendor disclosures: Ask the agent directly for any known disclosures about the property. This should be one of your earliest enquiries.

Once a property passes these initial checks, additional due diligence may include:

  • Engaging with neighbours: They can provide insights into the property and local community.

  • Building report assessment: Depending on the property’s condition and construction era, a building report may be prudent. Properties that feel dry, well-maintained, and smell fresh may not require a report, provided there are no visible issues such as water marks, uneven floors, monolithic cladding, or mould. Any red flags—such as asbestos, old roofing, or cheap construction materials—warrant professional inspection.

  • Comparative attractiveness: Evaluate how the property compares to others in the category. Consider design, orientation to the sun, street appeal, unique features, and location within the suburb.

  • Written representations: Document any questions for the agent or vendor in writing. This ensures clarity and creates a record of positive representations.

  • Insurance verification: Contact insurers to confirm the property can be adequately insured.

Effective due diligence is not necessarily about finding a property with zero issues. Sometimes a property will have no issues and you can still get a good deal, however often what you are looking for is a property that isn’t superficially attractive or that has minor or perceived issues. These properties have less competition. The key is to complete due diligence quickly, identify the potential red flags, and then assess their significance. Some concerns will be legitimate, while others may be manageable or accurately priced. For instance, an uneven floor caused by a few problematic piles may be inexpensive to remediate. The cost of such repairs may be able to be priced into your offer and create additional leverage in negotiations.


Simultaneously, due diligence should identify potential upsides. A property marketed as a two-bedroom home, for example, may have a large lounge that could be converted into an additional bedroom at minimal cost. Recognising these opportunities allows you to enhance value while mitigating risk.


4) Price the property

Establishing an appropriate price for a property requires a combination of careful analysis and informed judgement. You can usually find reporting on what properties are generally selling for relative to CV. Use this, and the CV of the property to get a baseline price. Then look at the online value estimate ranges and see how they compare. Then look at recent sales histories in the area for comparable properties – this is probably the most informative data (as long as you look at enough sales).


Maintain objectivity throughout the process. Consider whether there are features of the property that would make it more or less valuable than comparable properties – a good gut test is to look at what another comparable property sold for and ask yourself, assuming I got the property I am looking at for the same price as the comparable property sold for, would I be happier, or less happy than I would be if I had bought the comparable property.


Pricing a property is as much an art as it is a science. By observing the market over several months and making offers on multiple properties, you will begin to develop an intuitive sense of property values. To deepen your understanding, test your estimates: predict the likely sale price of a property at auction and then compare this with the actual outcome. This will help you calibrate your expectations and avoid under- or over-estimating value.


Once you have determined what you believe a property is worth, calculate a target “low price” by discounting 10–20% from that estimate. Identify the deal threshold that would make a purchase worthwhile, and establish your absolute bottom line—the maximum you are prepared to pay. This disciplined approach ensures that your offers are strategic, measured, and aligned with your financial objectives.


5) Make Your Offers

Properties in New Zealand are sold through a variety of processes: auctions, private treaty negotiations, deadline offers, and tenders. Listing prices are often indicative rather than definitive; it is therefore important to determine what you believe a property is genuinely worth, using the valuation and comparative process outlined previously.


As a purchaser, your goal should generally be to avoid processes designed primarily to create competition. Participating in auctions or tenders can be useful for familiarisation or if you are the only bidder, or a confident negotiator prepared to withdraw if the price exceeds your predetermined limit. However, unless you are the sole participant, these processes often make it difficult to secure a property below your bottom line.


Unconditional cash offers remain a highly effective approach. By law, agents are required to present all bona fide offers to the vendor unless instructed otherwise in writing. An unconditional, time-bound cash offer is therefore almost always presented to the vendor, and in many cases, agents will facilitate consideration of such offers. While agents may encourage participation in competitive processes, they are also motivated to secure genuine offers on behalf of vendors. If you encounter resistance, it is sufficient to politely and firmly request that your offer be presented.


After submitting an offer, agents may inform you of other potential bids or request a multi-offer submission. This is primarily a mechanism to create competition and to incentivise you to make your best offer. You don’t have to participate in a multi-offer. A better strategy is often to set a deadline after which your offer will be withdrawn if you have not received a response; this essentially calls the bluff. There is a chance that your initial offer will flush out a better offer and you will lose out; but it prevents the vendor leveraging an information asymmetry to get you to pay more – and if the other offer is not competitive it puts you in a strong position.


Psychologically, it is very difficult to reject an unconditional cash offer, particularly if the sales campaign has been running for a long time and if the market is tight. Parenthetically, market timing is relevant here. In a soft market, purchasers have greater negotiating power; in a strong market, competition is harder to avoid. Establishing your bottom line in advance, and adhering to it, is therefore essential.


Practical guidelines:

  • Do not bid against yourself. If an offer is declined, seek a counteroffer rather than increasing your initial bid;

  • Don’t be afraid to walk away  – silence is a great negotiating tool;

  • If you aren’t a confident negotiator, limit phone discussions and correspond in writing to maintain clarity and avoid giving away your position;

  • Experienced negotiators may use strategic dialogue to gain insight—but always remain measured, repeat key points, and avoid revealing financial limits;

  • Present yourself as dispassionate and purposeful. Demonstrating that you have other options and are not invested can enhance leverage. Actions often speak louder than words. E.g. claiming you aren’t emotional about the property is less effective than just making a low offer, expressing no disappointment if it isn’t accepted, and just wishing the vendor all the best and saying you’re moving on;  

  • Leverage due diligence findings appropriately. Where genuine issues are identified, highlight them to support your offer;

  • Protect your position by managing information carefully—avoid disclosing your maximum affordability;

  • Talking down a property to justify your offer is a double-edged sword. Sometimes, if it is consistent with how you present, a better tactic can be to be openly enthusiastic about a property and present your offer as the absolute limit of what you can afford.

People like to feel like they got a win out of you, this is a good psychological inducement to settle. It is therefore worth it to put your first offer a little lower than what you actually hope to pay, to give yourself room to come up.


If you receive a counter-offer that is a strong signal. Come up a bit, but don’t enter into a horse trade. Designate any revised offer as “best and final” and be prepared to walk away if that doesn’t close the gap significantly.


Once the gap narrows to 1-3% of the property value it is usually prudent to accept and close the deal. If you’re close to closing a good deal (relative to where you see the value) then 1-3% should still leave you plenty of margin.


Finally, recognise that not every property will be the right opportunity. Success in property acquisition is often about identifying the outliers—properties that offer value significantly above the market norm—and approaching each negotiation as a calculated opportunity rather than with an expectation of success. You are looking for the one property in ten that is going to sell a couple of standard deviations below the average – so a failed negotiation should be expected, not a source of disappointment. If you get a deal on the first try, you might just be really lucky, but it is probably more likely that you’ve overpaid.


6) When to Engage a Lawyer Early in the Process

Engaging a lawyer prior to signing a sale and purchase agreement can be valuable in a number of circumstances:

  • Where the draft sale and purchase agreement contains unusual or non-standard terms;

  • When the property is a unit title, which can carry complex risks that a skilled lawyer can help identify and clarify;

  • If there are aspects of the LIM that are unclear or raise questions;

  • Where there are unusual matters on the title—a lawyer can explain these, their implications, and whether they are potential deal breakers or opportunities for negotiation;

  • If the property is cross-lease and you are not familiar with the legal implications of this ownership structure.


For standard freehold properties with a clean title and a boilerplate agreement, it is often reasonable to defer legal involvement until the agreement is concluded, potentially saving on costs, but engaging a lawyer to review the contract prior to signing is the best practice to minimise risk.


Beyond conveyancing, a lawyer with negotiation experience can provide additional strategic value. While most clients engage lawyers to manage and mitigate risk, some also leverage their lawyer’s expertise to enhance the outcome of negotiations. Experienced lawyers can help identify and realise value that might otherwise be overlooked.


Don’t leave your next property deal to chance. Contact Gordian Legal today to ensure your purchase is both financially smart and legally secure.

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