Selling Property: Obtaining a Code Compliance Certificate.
Whether buying, building, or selling a property it is extremely important to understand the requirements around a Code Compliance Certificate (CCC).
What is a code compliance certificate?
A CCC is a certificate issued by Council to confirm that the building work complies with the Building Consent and Building Code.
What can go wrong if I don’t have one?
Lack of a CCC may reduce the value of the property or your ability to sell. You may also have trouble obtaining bank lending or arranging insurance. The case study below outlines what can potentially go wrong for those who do not obtain a code of compliance prior to entering a sales agreement.
Case study: Lisa and James
Lisa and James decided it was time to sell their home and make the big move overseas. All they needed was a keen buyer. Lisa and James were in luck as the neighbour had heard they wanted to sell and put an offer forward.
The only problem was that the house did not have a Code Compliance Certificate. Lisa and James asked their builder friend, Steve to come and check their house to see if they would have any issues. Steve said the property appeared to be structurally sound and that they shouldn’t have a problem with getting the Code Compliance Certificate from Council.
Lisa and James were eager to get the deal done, so they agreed with their neighbour that they would sign an agreement conditional on Lisa and James obtaining the Code Compliance Certificate. If Lisa and James were not able to provide a copy of the Code Compliance Certificate to their neighbour within 20 working days from the date of the agreement, their neighbour could cancel the agreement. Lisa and James thought 20 working days would give them plenty of time to get the paperwork into Council and receive a copy of the Code Compliance Certificate. They decided to give notice to their employers, book their flights and arrange a temporary rental. They were so excited to start their big adventure overseas.
Lisa and James thought 20 working days would give them plenty of time to get the paperwork into Council and receive a copy of the Code Compliance Certificate. They decided to give notice to their employers, book their flights and arrange a temporary rental. They were so excited to start their big adventure overseas.
Lisa and James had the house inspected by Council and were completely shocked to hear that the house failed the inspection. Council stated that there were a number of issues with the building that needed to be fixed and required copies of paperwork from the contracts when the property was constructed.
Lisa and James urgently contacted a builder to come to the property and provide them with a quote and an estimated completion date for the works. Much to their surprise the quote was for almost $10,000.00 and the work would take approximately 3 months considering the weather and public holidays. Panic began to set in as Lisa and James realised that they are now more than likely going to lose the sale. There was also the problem of their jobs, flights and new rental.
Lisa and James could have avoided this situation if they had checked the property records and obtained legal advice before entering into an agreement.
If you feel you could use some specialist advice, don’t hesitate to contact the Property Team.
