Do you need a lawyer to buy a house?

Do you need a lawyer to buy a house? Actually, no. There is no law that says you have to use a lawyer or a conveyancer. What the law does is limit who you can pay to do the work for you, and it lets both of them do it.¹²³

That’s the short answer, but it leaves out what catches people out: what you’d sign doing it yourself, who the agent works for, and when only a lawyer will do.

What the law says

The law calls this work conveyancing, the legal work of buying or selling a property, and getting the new owner onto the official land record.

Only a lawyer or a conveyancer, or someone working under one of them, may do that work for someone else for a reward, whether the reward is direct or indirect. Anyone else who does is committing an offence.¹ None of that stops you doing the work on your own purchase.

Whoever helps you, one document has to be signed by you, or by your own lawyer or conveyancer, and nobody else. It is the statement that goes in with the paperwork changing the owner.³ In it you confirm that you know the circumstances of the sale. You also confirm that you know of no reason, in the facts or in the law, why the change of owner should not be registered.

That second part means you are vouching that nothing legal stands in the way, which you can only do if you know what could. The agency that runs the land records handles the registration, but it can’t give you legal advice. Its own guide says each kind of document has its own legal requirements and consequences, so you may find you still need advice.⁴

Before you sign the agreement

The agreement is a sale and purchase agreement, the written contract you and the seller both sign, covering the price, the property, and any conditions you’ve each agreed to. Once you’ve both signed it, it’s legally binding.

The agent selling the house may draw up the agreement, and may talk you through it. But they have to recommend that you get legal advice, and give you a fair chance to get it.⁵ So you can ask for time to send the agreement to a lawyer or a conveyancer first.

A salesperson with less than six months’ experience can’t draw it up at all.¹ And it always pays to remember that, while the agent has to deal fairly with you, they work for the seller.⁶

Lawyer or conveyancer?

A conveyancer is someone who holds a practising certificate from the New Zealand Society of Conveyancers. A lawyer is someone who holds a practising certificate as a barrister, or as a barrister and solicitor, which lets them do conveyancing and other legal work besides.¹ Either can do the work of buying a house for you. So what makes the difference?

It’s when there is work that only a lawyer may do. Two kinds can come up when you buy a house.

If the purchase ends up in court. If buying the house turns into a dispute before a court or tribunal, you can speak for yourself. But if you want someone to advise you on the case or speak for you, that is, as a rule, a lawyer’s work. A conveyancer can’t do it unless the law, or the court or tribunal, allows it.¹

If a lawyer did your conveyancing, they already know your purchase from the start. If a conveyancer did it, you would be bringing a new lawyer up to speed.

Other legal work tied to the purchase. Some laws say only a lawyer may do certain things.¹ An example, if you buy with a partner, is an agreement about who owns what. It sets aside the usual rules on how your property would be divided between you.

For that agreement, each of you must get your own legal advice first. A lawyer must witness each signature, and certify that they explained what it means.⁸ So even if a conveyancer is doing the rest of your purchase, a lawyer has to be part of this.

What protects you either way

Whichever you choose, the Lawyers and Conveyancers Act protects you in three ways, with separate arrangements for each profession.

Your money stays separate. A lawyer keeps money they hold for you in a trust account, a separate bank account where a lawyer must hold money that belongs to you. It is kept apart from the firm’s own money, and can only be paid out to you or as you direct. The law puts the same duty on a conveyancer.⁷

A backup fund if that money is stolen. Each profession has one: the Lawyers’ Fidelity Fund and the Conveyancing Practitioners’ Fidelity Fund. If a lawyer or conveyancer steals money they were holding for you, their profession’s fund can pay you back.⁹ If the problem is poor work rather than stolen money, that is what the complaints service is for.

A complaints service that can put things right. The Law Society takes complaints about lawyers, and the Society of Conveyancers takes complaints about conveyancers.⁷ If a complaint is upheld, a committee can order an apology, compensation for a loss, a cut or refund of fees, or the mistake fixed at the person’s own cost. If you’re unhappy with the decision, you can ask a review officer, who by law is neither a lawyer nor a conveyancer, to look at it again.¹⁰

So, do you need one?

The law leaves it to you. But the agreement binds you the moment you both sign it, and the statement you’d sign on your own is a legal one. The trust account, the backup fund and the complaints service only come with a lawyer or a conveyancer.

Other pages that may help

If you choose a lawyer, there are things they must put in writing before they start. What it costs to check a house covers the other costs of buying, and why nobody publishes a price for a lawyer’s work.

What to ask your lawyer

1. Are you a lawyer or a conveyancer? If something goes wrong with this purchase and it ends up in court, can you act for me, or would I need someone else?
2. Can I send you the agreement before I sign it, and what would you charge to look at it then?

Say these as they are written. They are normal questions to ask.

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