I had a first home buyer client win an auction a few weeks back, and she was the only bidder in the room.
Sit with that for a second, because it should surprise you.
It wasn’t because the house was ugly, or overpriced, or in a bad street. Quite the opposite. The agent’s own feedback was that plenty of people had been through, loved it, and wanted it. Right size, right price point, right kind of street. Everything a first home buyer is after.
So why did my client walk away with it, uncontested, on a Saturday when these things are normally a scrap?
Because she was the only one who’d sorted out her insurance before the big day.
That’s not a typo. Insurance, not finance.
No insurance – no lending
Years ago, someone had done some work on this place that never got signed off. No building consent, no code of compliance certificate, nothing on paper to show for it. I want to be clear, this wasn’t some dodgy lean-to about to fall down. It was a bathroom that had been doing its job perfectly well for years.
But this is the thing about banks and unconsented work: they don’t really see it as a building problem. They see it as an insurance problem, and that’s a different beast altogether.
Follow the chain with me. If an insurer won’t cover a property, the bank won’t lend against it. If the bank won’t lend, most buyers simply can’t complete the purchase, however much they love the kitchen island or the walk-in shower. So, you end up with a house that ticks every box on a buyer’s list, and is still nearly impossible to sell, purely because the paperwork on some long-forgotten renovation went missing along the way.
That’s exactly what happened here. Every other interested buyer hit that same wall and drifted away without a word. My client didn’t, because we’d already done the work to sort her insurance position before auction day. Let me walk you through it.
How we got her over the line
The property was being sold as is, which meant the sale and purchase agreement made no promise about the quality or compliance of the work that had been done. Fair enough, as far as it goes, but it left a question mark hanging over the parts of the house that weren’t on the original plan. And sure enough, when my client applied for finance, the bank came straight back and asked about those areas specifically. Were they safe? Would they hold up? Could they be insured?
So we went and got a ‘safe and sanitary report’ done, aimed squarely at the areas the bank had flagged. Think of it as an independent professional standing in that bathroom and saying, this doesn’t meet the current building code, and it was never signed off, but it’s been built in a tradesman like manner, it does what it’s meant to do, and it’s fit for purpose. In plain terms: watertight, working properly, nothing about to fail or cause damage down the track.
We took that report to the insurer, and this is the bit I love. They came back and said yes. They understood there was no consent and no code of compliance certificate on file, but they were comfortable with the condition of the work because an independent report said it was sound. They issued cover. Once that was in place, the bank had exactly what it needed to approve the lending. From there, all my client had to do was turn up.
One report. One yes from the insurer. That’s the whole trick.
The other way to skin this insurance cat
There’s a second option worth knowing about too, a certificate of acceptance from the council. Someone comes out, has a look at the work, and if they’re satisfied, issues a certificate saying they accept it as it stands, even though it was never consented at the time. It’s a perfectly legitimate route. It just tends to take longer and cost more than a safe and sanitary report, which is why I’ll usually steer people toward the report first.
If you’re selling, do this before, not after
If you own an older property, and a fair chunk of Auckland’s housing stock qualifies, it’s worth asking this question before you list, not after. If there’s unconsented work anywhere in the house, a bathroom, a deck, a garage conversion, whatever it might be, get ahead of it now. A ‘safe and sanitary report’ costs a fraction of what it costs you to watch your sale drag on for months while buyer after buyer hits the same wall and walks away without a word.
Honestly, the agent running my client’s auction probably should have organised that report before the property ever went to market. If they had, there might have been 10 approved bidders in that room instead of one, and the vendor would likely have walked away with a better price. Instead, my client got herself a very good deal, almost entirely because nobody else had done the legwork.
And that, right there, is the whole game. The properties that sell easily, in any market, are the ones where someone has already cleared the obstacles between a buyer falling in love with a place and being able to buy it. Unconsented work is one of the most common of those obstacles, and one of the easiest to fix, if you deal with it early.
So if you’re buying, ask the question before you fall for the place. If you’re selling, don’t wait for a buyer to ask it for you.
Get in touch and we’ll talk through what to check, whether you’re about to buy or about to list.