Unconsented Renovations Just Cost Three Auckland Agents $18,000 — Here’s What Wellington Sellers Should Learn

Last week the Real Estate Agents Disciplinary Tribunal smacked three Auckland salespeople with a combined $18 k fine after they marketed a home without mentioning the garage-to-rumpus conversion — and an extra toilet — that never saw a council inspector. Buyers only discovered the problem while arranging insurance, the deal collapsed, and everyone went back to square one. nzherald.co.nz

If you think “that’s an Auckland problem”, think again. Wellington properties are full of 1990s conservatories, bonus bedrooms over the garage, and mystery bathrooms squeezed under staircases. The bank, the insurer, and now the watchdog don’t care how cute the space looks on Instagram; if there’s no paperwork, it’s a red flag the size of the Basin Reserve.

What actually happened?

• The work: Part of the garage was turned into a rumpus room plus an extra loo.

• The paperwork: None. No building consent, no code compliance certificate.

• The agents’ mistake: They advertised the property as if everything was above board and failed to warn bidders in writing.

• The fallout: Buyers couldn’t get insurance, financing was declined, the contract collapsed, and the Tribunal issued an $18 k penalty plus compulsory training.

Why insurance is the real bouncer at the door

In New Zealand the bank won’t hand over a cent until the insurer says the property is insurable. Unconsented work makes insurers itchy. No cover means no loan, and no loan means the whole contract unravels. That’s exactly what happened here, and it’s why the Tribunal treated the omission as more than a paperwork slip-up — it was a deal-breaker.

Lessons for Wellington homeowners

1. Verbal “she’ll-be-right” is worthlessIf the work wasn’t signed off by the city council, assume buyers will find out. They have LIM reports, building inspectors, and Google.

2. Fix it or price itRetro-consent can cost less than the first price drop after weeks on the market. If fixing isn’t practical, be upfront and reflect it in the price so buyers can budget for compliance.

3. Transparency sellsWhen buyers know exactly what they’re getting, negotiations stay focused on value, not hidden risks. Full disclosure often attracts more confident offers rather than “walk-away” silence.

How we handle compliance checks (so you can sleep at night)

• Consent audit built into our listing process – we compare your property file with what’s physically on site.

• Options not ultimatums – if something’s missing we map out the choices: retro-consent, professional sign-off (yes, engineers still exist), or a marketing strategy that tells buyers the truth and prices accordingly.

• Everything in writing – findings go straight into our Buyer Pack. Insurers love it, lawyers love it, and most importantly, buyers don’t get spooked three days before settlement.

The bottom line

Cut-price shortcuts today can cost a bucket tomorrow. The Tribunal’s $18 k penalty is a headline-grabbing reminder, but the real damage is lost time, buyer distrust, and a deal that never settles. If you’re even slightly unsure about that bonus room or backyard studio, let’s talk before the photographer arrives. Fifteen minutes now beats six weeks of “conditional” later.

Ready for a no-nonsense compliance check? Book a quick call and we’ll make sure your sale is remembered for its result, not its paperwork nightmare.

Written by Leonie Snook, Senior Real Estate Agent, Harcourts Wellington — helping sellers keep it transparent, compliant, and ultimately sold.

Sources: Real Estate Agents Disciplinary Tribunal decision reported by NZ Herald (16 Dec 2024) nzherald.co.nz; original LinkedIn commentary by Leonie Snook (2 weeks ago) linkedin.com