REINZ calls for clear guidelines for agents around changes
19 February 2018
REINZ calls for clear guidelines for agents around changes to Bright Line test
Following the announcement from the Revenue Minister, Stuart Nash, that has confirmed the bright-line test on residential property sales will be extended from two years to five years in legislation currently making its way through Parliament the Real Estate Institute of New Zealand (REINZ) is calling for clear guidelines as part of the legislation.
REINZ would also welcome the opportunity to work alongside the Government to support the effective implementation of this policy.
Bindi Norwell, Chief Executive at REINZ says: “Often real estate agents are the first point of contact for members of the public when it comes to selling investment properties, so we would like to ensure there are very clear guidelines for members of our industry to follow when implementing any changes that are required by the legislation.
“Most recently the industry has had regulatory changes to deal with regarding methamphetamine levels, we’re now working through what the foreign buyer ban will mean for our members and we’re gearing up to deal with the new Anti-Money Laundering regulations that come into effect on 1 January 2019. This will be another piece of legislation for our members to get up to speed with, so we would like to ensure there is ample time for the industry to implement any changes required,” continues Norwell.
Broadly speaking, REINZ is supportive of the extension of the bright line test from 2 to 5 years as the Institute believes the test will help meet the objectives of preventing profit making by selling properties quickly.
“Any measure that helps to improve housing affordability and reduce speculative demand is to be welcomed. However, any extension to the rule needs to help support a stable market and not impact people who genuinely need to sell an investment property reasonably quickly e.g. due to increasing family size, serious illness or job losses,” continues Norwell.
If the three-year extension to the bright line test is implemented, current exemptions will remain including the exemption for the main home of owner-occupiers of residential property.