The Sale and Purchase Agreement: The Clauses Every Vendor Should Understand

Most vendors I work with read the Agreement for Sale and Purchase properly for the first time while they are holding a pen. Someone has brought them an offer, the number at the top is the one they have been waiting months to see, and the pages underneath it suddenly feel like a formality.

They are not a formality. That document decides when you are locked in, what you have promised about your own home, who is holding your deposit, and what happens if the buyer's finance falls over. And as of April 2026, it is a different document from the one you may have signed last time you sold.

The Form Changed in April 2026

The standard agreement used for almost every residential sale in New Zealand is published jointly by The Law Association of New Zealand, which many people still know by its former name of the Auckland District Law Society, and REINZ.

The current version is the Eleventh Edition 2022 (4), and it applies to agreements entered into from 21 April 2026. If you are reading older guidance online, including a good deal of agent commentary that has never been updated, you may well be reading about the previous version.

The changes are not cosmetic. Several of them land squarely on the vendor, and I will come to those.

When You Are Actually Bound

You are bound when both parties have signed and that acceptance has been communicated. Not when you shake hands. Not when you agree verbally over the phone. Not when the buyer tells your agent they are delighted.

From that moment the agreement is a binding contract. If it is conditional, those conditions sit on top of a contract that already exists. This is the point vendors most often misunderstand: a conditional agreement is not a maybe. You are committed. The buyer holds a defined set of exits, and generally you hold none.

One quiet but important change in the current edition: the deemed service period for posted documents has been extended from three working days to five. Dates drive almost everything in this contract, and that one moved without much fanfare.

The Conditions, Read From Your Side of the Table

I have written separately about surviving the conditional period once an offer is live, so here I want to focus on something different: what each condition means while you are still deciding whether to accept it.

• Finance. The buyer's lender has to say yes. Under the current edition, a buyer cancelling on finance must give you a reasonable explanation together with evidence of the steps they took to obtain funding. The previous wording asked for a satisfactory explanation, and the shift to an evidence based test is a modest improvement for vendors.
• LIM. The buyer orders a Land Information Memorandum from council and can withdraw if it reveals something they reasonably object to. If you suspect anything at all, order your own before you list. A surprise you find first costs far less than the same surprise found by your buyer.
• Builder's report. The most common place a sale gets renegotiated rather than lost. A report will find something, because they always do. The real question is whether it finds something you did not already know about.
• Due diligence. The broadest condition, and the one I am most cautious about on a vendor's behalf. A widely drafted due diligence clause can amount to a near unconditional right to walk away. If one appears in your offer, have your lawyer read the exact wording before you accept it, not afterwards.

A shorter condition period is often worth more to you than a slightly higher price attached to a long one. Every day under a conditional contract is a day your property is effectively off the market.

The Deposit, and Whose Money It Actually Is

The deposit is usually 10% of the purchase price. It is recorded on the front page of the agreement along with where it is to be paid, which is normally the agency's trust account.

Here is the part that surprises nearly every vendor. That money is not yours yet. Under the Real Estate Agents Act a deposit must be held for ten working days before it can be released, and until that period has run it still effectively belongs to the buyer. It cannot be released early except by a court order or by an authority signed by every party to the transaction.

This matters enormously if you are buying as well as selling and were planning to use the deposit from your sale to fund the deposit on your purchase. That is a very common plan, and it does not survive contact with the ten working day rule unless the dates are arranged carefully. Tell your lawyer what you are intending early, not the week before settlement.

What You Are Warranting Without Realising It

When you sign, you make a series of promises about your property. The current edition added several.

• Restricted building work. You now warrant that any restricted building work carried out since 13 March 2012 was done or supervised by a suitably qualified person under the Building Act. If someone did unconsented structural work on your home in that window, this is the clause where it surfaces.
• The form has not been altered. A new warranty confirms the standard form is unaltered. Changes are still permitted, but the original wording has to remain visible and anything added or deleted must be clearly marked. Quietly retyped clauses are not acceptable.
• Unit titles. If you own a unit title property, you can no longer vote to alter the unit title warranties before settlement without the buyer's consent.
• Tenanted property. Any pet bond must now be disclosed separately from the general bond.

Warranties are not paperwork. They are promises you remain legally answerable for after settlement, and a breach can surface as a compensation claim months after you have moved out and moved on.

A Final Thought

You do not need to become a property lawyer. You do need to read the agreement before you sign it rather than afterwards, and you need a lawyer who is working from the current edition rather than the last one. This article is general information rather than legal advice, and your own lawyer should always be the final word on your particular agreement.

My job at that table is to make sure you understand exactly what you are agreeing to, especially the parts that are easiest to skim past. An offer that looks strong on price and weak on terms is not a strong offer, and that difference is almost always buried in the conditions rather than printed at the top.

If you are preparing to sell and would like to walk through the agreement properly before an offer ever lands, I am very happy to sit down and do exactly that with you. Book your free market appraisal today.