The Sale and Purchase Agreement

📝 The Contract That Buys a Home

The sale and purchase agreement is the legally binding contract used to buy or sell property in New Zealand. It sets out the price, who is buying and selling, the deposit, the settlement date, what is included, and the conditions that must be met. Because it is binding once signed by both parties, understanding it, and getting legal advice before you sign, is one of the most important steps in any property purchase.

                Key Point: A sale and purchase agreement is a binding legal contract, not a casual expression of interest. Once both parties have signed and any conditions are met, you are committed. The agreement contains the price, deposit, settlement date, chattels included, and crucially any conditions, such as finance, a building report, or a LIM, that must be satisfied. You should have your lawyer review it before you sign, not after.
            

What the Agreement Covers

The parties, the property, and the agreed price.
The deposit amount and when it is paid.
The settlement date, when ownership and the balance change hands.
The chattels included, like the oven, curtains, or heat pump.
The conditions that must be met for the sale to go ahead.

✅ Conditional and Unconditional

One of the most important ideas is the difference between a conditional and an unconditional agreement. Conditions are things that must be satisfied before you are fully committed, and they protect the buyer.

Common Conditions

Condition	What it protects
Finance	That your lender will actually approve the loan for this property
Building report	That the property is sound, via an inspection
LIM report	That council records reveal no nasty surprises
Insurance	That you can insure the property
Sale of your own home	That you can sell before committing, where included

From Conditional to Unconditional

While conditions are unmet, the agreement is conditional, and if a condition cannot be satisfied you can usually withdraw without penalty, following the agreement terms. Once all conditions are met or waived, the agreement becomes unconditional, and you are fully committed to buy. Going unconditional is the point of no return, so never do it until finance is confirmed and your checks are complete.

                Unconditional means committed: Once the agreement is unconditional, you must complete the purchase. Pulling out after that can mean losing your deposit and facing further liability. This is why conditions, and confirming them properly, matter so much.
            

💰 Deposit, Settlement and Chattels

The Deposit

The agreement sets a deposit, often a percentage of the price, usually paid once the agreement becomes unconditional. It is typically held in a trust account, not handed straight to the seller. The deposit is part of the purchase price, with the balance paid at settlement.

The Settlement Date

Settlement is the day the rest of the money is paid and ownership transfers to you. The date is set in the agreement, and your lawyer and lender coordinate the funds. Being clear on the settlement date matters for arranging your loan, insurance, and the practical move.

Chattels and What Is Included

The agreement lists the chattels included in the sale, such as the stove, light fittings, curtains, or a heat pump. Anything not listed may not be included, so it is important the agreement records exactly what stays with the property. Disputes often arise from assumptions about what was included, which a clear agreement avoids.

Agreement signed, price and conditions set

Conditions worked through, then the deposit is usually paid on going unconditional

Settlement date arrives, balance paid, ownership transfers

You receive the keys and the included chattels

💡 Getting It Right

Use a Lawyer Before You Sign

The strongest protection is to have your lawyer or conveyancer review the agreement before you sign, or to make your signing conditional on legal review. They check the conditions are right, the dates work, and you understand your obligations. Property is one of the largest purchases you will ever make, and the cost of legal advice is small against the risk of a problem in the contract.

Practical Tips

Get the conditions you need: finance, building report, and LIM are common protections; do not skip them under pressure.
Allow enough time: make sure condition dates give you time to actually complete each check.
Check the chattels list matches what you expect to be included.
Never go unconditional until finance is confirmed and checks are done.
Be careful at auction: auction sales are usually unconditional, so checks must be done beforehand.

Auctions remove your conditions: Buying at auction usually means signing an unconditional agreement on the spot, with no finance or inspection conditions. That makes doing your finance, building report, and LIM before the auction essential. See our guide on auctions versus deadline sales and tenders.

Pair this with our guides on conditional offers, building inspection reports, and reading a LIM report. Final word: the sale and purchase agreement is the binding contract that buys a home, covering price, deposit, settlement, chattels, and conditions. Get legal advice before signing, secure the conditions you need, and never go unconditional until finance is confirmed and your checks are complete. This is general information, not legal advice.

🎯 Test Your Knowledge

Quiz on The Sale and Purchase Agreement (20 Questions)

1. A sale and purchase agreement is:

A legally binding contract to buy or sell property

A casual expression of interest

A type of mortgage

A council form

2. You should have your lawyer review the agreement:

Before you sign

After settlement

Never

Only if there is a dispute

3. The agreement sets out the:

Price, deposit, settlement date, chattels, and conditions

Only the price

Only the colour of the house

Only the seller name

4. Conditions in an agreement:

Must be satisfied before you are fully committed

Are optional decorations

Bind the seller only

Mean nothing

5. A finance condition protects that:

Your lender will actually approve the loan for this property

You can paint the house

The seller is honest

The price is fixed

6. While conditions are unmet, the agreement is:

Conditional, and you can usually withdraw if a condition fails

Unconditional

Cancelled

Settled

7. Once all conditions are met or waived, the agreement becomes:

Unconditional and you are fully committed

Cancelled

Conditional again

Optional

8. Pulling out after going unconditional can mean:

Losing your deposit and further liability

No consequences

A refund

A better price

9. The deposit is usually:

A percentage of the price, often held in a trust account

Paid in cash to the seller directly

Never required

The full price

10. Settlement is the day:

The balance is paid and ownership transfers

You first view the house

The agreement is signed

The deposit is refunded

11. Chattels in the agreement are:

Items included in the sale, like the oven or curtains

The land only

The mortgage

The deposit

12. Items not listed in the agreement:

May not be included

Are always included

Belong to the council

Are free extras

13. Disputes about what was included can be avoided by:

A clear chattels list in the agreement

Assuming everything stays

Verbal promises

Guessing

14. The strongest protection when buying is to:

Have a lawyer review before signing

Sign first and ask later

Skip legal advice

Go unconditional immediately

15. Condition dates should:

Give you time to actually complete each check

Be as short as possible

Be ignored

Be after settlement

16. You should never go unconditional until:

Finance is confirmed and checks are done

You feel like it

The seller says so

The agent insists

17. Buying at auction usually means:

Signing an unconditional agreement on the spot

A conditional offer

No contract

A refundable deposit

18. Because auctions are unconditional, you must:

Do your finance, building report, and LIM before the auction

Do checks afterwards

Skip all checks

Rely on the seller

19. Common protective conditions include:

Finance, building report, and LIM

Only the price

None

The colour scheme

20. The best summary of the sale and purchase agreement is:

A binding contract; get legal advice, secure conditions, and go unconditional only when ready

A casual note

A council form

A mortgage application

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