Buying your first home in New Zealand is exciting, but often confusing. From pre-approvals and LIM reports to settlement dates and cross leases, the process is packed with unfamiliar terms. Use this plain-English glossary to confidently navigate each step of the home-buying journey.
Appraisal
An estimate of a property’s market value provided by a real estate agent. Not legally binding and not the same as a formal valuation.
Auction
A public bidding process to sell a property. If you win and the reserve is met, your bid becomes an unconditional agreement.
Body Corporate
An organisation responsible for managing shared spaces in unit title developments, like apartment buildings. Owners pay body corporate fees.
Building Report
An inspection report by a qualified builder that highlights structural and maintenance issues. Recommended before making a purchase.
Buyer’s Agent
A real estate agent who works for the buyer rather than the seller. Still uncommon in NZ but gaining popularity.
Certificate of Title
A legal document proving ownership of a property and showing any registered interests like mortgages, covenants, or easements.
Chattels
Moveable items included in the sale—such as whiteware, curtains, or light fittings. These should be clearly listed in the contract.
Conditional Offer
An offer subject to specific conditions, such as finance approval, building inspection, or sale of your existing home.
Cross Lease
A type of property title where owners share the land and lease their individual portions back from each other. Often includes restrictions.
Deposit
The upfront payment (commonly 10%) is paid after going unconditional. Held in trust until settlement.
Easement
A legal right for another party to use part of your land, often for access or utilities. Recorded on the title.
Equity
The difference between your property’s value and the amount you owe on your mortgage. Your ownership stake.
First Home Loan
A low-deposit home loan is available to eligible buyers via Kāinga Ora.
Fixed Interest Rate
An interest rate locked in for a set term (e.g., 1–5 years), offering repayment stability.
Floating Interest Rate
A variable rate that fluctuates with market conditions. Offers flexibility to make lump sum payments or switch loan structures.
Freehold
The most common type of property ownership in NZ. You own the land and any structures outright.
Guarantor
A person (usually a family member) who agrees to repay your mortgage if you default. Used to improve loan approval chances.
GV (Government Valuation)
Also called the CV (Capital Value), this is the council-assessed value of a property for rating purposes, not market value.
Interest-Only Loan
A loan where you only repay interest for a set time, delaying principal payments. Usually used short-term or for investment.
KiwiSaver First Home Withdrawal
Most first home buyers can withdraw their KiwiSaver funds (minus $1,000) to use toward a deposit, if eligible.
LIM Report (Land Information Memorandum)
Council-prepared report containing information on the land, buildings, consents, hazards, and zoning.
Loan Pre-Approval
An indication from your lender of how much you can borrow, subject to conditions. Strengthens your credibility as a buyer.
Loan-to-Value Ratio (LVR)
The ratio of your loan to the property’s value. Banks prefer LVRs of 80% or less, though low-deposit options exist for eligible buyers.
Market Value
The estimated price a property would sell for in an open market. Can differ from GV or purchase price.
Mortgage
A loan used to purchase property, where the home acts as security for the lender.
Mortgage Broker
An intermediary who helps you find and apply for a home loan. Their service is usually free to borrowers.
New Build
A home that has been newly constructed and not previously lived in. Often eligible for First Home Grants and full interest deductibility.
Offset Account
A bank account linked to your mortgage. The balance offsets the interest charged on your loan, reducing costs over time.
Possession Date
The date you gain legal access to the property. Often (but not always) the same as settlement day.
Property Valuation
A formal valuation conducted by a registered valuer, often required by lenders before approving a loan.
Rates
Local government taxes paid by property owners to fund services like water, roads, and rubbish collection.
REINZ
The Real Estate Institute of New Zealand. Provides data and standards for property professionals.
Reserve Price
The minimum price a seller will accept at auction. If not met, the property may be passed in.
Sale and Purchase Agreement
This is the contract that governs the terms of the sale.
Settlement Date
The date when the purchase is finalised, the remaining funds are paid, and you become the legal owner.
Subject to Finance
A common clause in conditional offers. Protects you in case your home loan isn’t approved.
Unconditional Offer
An offer with no conditions attached. Once accepted, it’s legally binding and can’t be withdrawn without penalties.