LEGAL
Next edition of the ASPRE (AGREEMENT FOR SALE AND PURCHASE OF REAL ESTATE)
The ADLS ASPRE Sub-Committee — of which REINZ is a part — has been working on the next edition of the Agreement for Sale and Purchase of Real Estate (ASPRE). The eleventh edition will be released in the new year.
The next edition of the ASPRE follows an extensive review process that incorporated input from the legal and real estate professions. REINZ has worked closely with ADLS to represent member feedback throughout the drafting process. The focus was on three primary areas: formatting and usability, the purchase price allocation (PPA) addendum, and the inclusion of a new COVID-19 clause.
Formatting and useability Following significant feedback, the eleventh edition of the ASPRE will address members’ concerns around formatting and useability, to deliver a better experience for all involved in the transaction process. We are hopeful a multitude of small changes and more space where you told us you needed it, will make the forms more useable.
PPA Addendum In July 2021, important changes to the Income Tax Act 2007 relating to purchase price allocation come into force. These aim to prevent taxpayers from allocating asset values to get a more favourable tax outcome when buying or selling assets such as property. ADLS and REINZ issued an addendum to the ASPRE, Tender Agreement and Business Agreement to allow parties to deal with a PPA under the new rules. As members voiced strong opposition to its inclusion as a General Term, it will remain an optional addendum.
Inclusion of a COVID-19 clause COVID-19 has disrupted business as usual. Following the first lockdown — where some buyers and sellers found themselves unable to settle — COVID-19 clauses were introduced. The real estate profession called for a COVID-19 deferred settlement clause to be included in the next edition
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The Real Estate Institute of New Zealand
Melisa Beight, General Counsel, REINZ
of the ASPRE as a General Term. REINZ advocated strongly for this, and a new COVID-19/pandemic clause will be included as a General Term. The ADLS/REINZ COVID-19 clause will also be available in eForms in the interim, as an optional clause, which REINZ strongly recommends is used in the ASPRE. REINZ has also requested a bespoke COVID-19 clause for the Auction Agreement.
What’s next? Following the release of the ASPRE, the Tender Agreement, Auction Agreement and Business Agreement will follow.
Final word REINZ members have been front of mind throughout this process. Your feedback has shaped the eleventh edition of the ASPRE. Looking forward, REINZ and ADLS are exploring ways we can better work together. We want to ensure industry representation on the ADLS ASPRE Sub-Committee for the following edition, and we’re pushing for user testing of the eForms functionality pre-release. We believe those who use these resources day-to-day and understand the issues first-hand, should have a guiding voice. Finally, a massive thank you to all of you for your feedback over the past months. We look forward to delivering the next edition of the ASPRE in the new year. REINZ will provide support to members around the new ASPRE. Timed to coincide with the release, we will run webinars and share detailed information sheets. For any additional questions, please reach out to advisory@reinz.co.nz.
