To qualify for the 5-year bright-line period for new builds, 1 of the following must apply:
- For an existing new build, you must have acquired it no later than 12 months after the code compliance certificate (CCC) for that new build was issued under the Building Act 2004.
- Where you buy a new build off the plan, the CCC confirming the dwelling was added to the land must have been issued by the time you sell the land and the title is transferred. This is generally also the date settlement occurs.
- If you construct a new build on your land, the CCC must be issued by the time you sell the land and the title is transferred. This is generally also the date settlement occurs.
In all cases, a new build must be self-contained and received its code compliance certificate (CCC) issued under the Building Act 2004 on or after 27 March 2020 confirming this. There are some exceptions that apply – see other buildings that can qualify below.
A new build does not have to be made of new material or constructed onsite, so it can include modular and relocated homes.
Other buildings that can qualify as a new build
A remediated or converted building can also qualify as a new build in any of the following situations:
- It was removed from the earthquake prone buildings register on or after 27 March 2020 and you can prove the remediation is complete. Proof can be either a CCC or local or building consent authority records showing the work was completed and then signed off by a qualified engineer.
- It had weathertightness issues in the past but it’s now at least 75% reclad and a CCC was issued on or after 27 March 2020 for the reclad.
- It has been converted from a commercial premises and a CCC was issued on or after 27 March 2020 confirming the conversion has been completed.
- It was converted from a hotel or motel, and local or building consent authority records show the conversion was completed on or after 27 March 2020.
- It is part of a building with 2 or more dwellings that before conversion was just a single dwelling, and a CCC was issued on or after 27 March 2020 confirming the conversion.
Self-contained means the residence needs to have its own cooking and bathroom facilities and have its own entrance. The entrance can be from a shared access way, for example, a hallway shared by a block of flats in the same building.
Still on the land when it is sold
Unless destroyed by natural disaster or fire, the new build must still be on the land when it is sold, otherwise the 10-year bright-line period applies.
New and non-new builds on the same title
If there is a new build and a non-new build on the same legal title.
- The portion of the land with the new build on it qualifies for the 5-year new build bright-line period.
- The portion of the land with the non-new build on it is subject to the 10-year bright-line period.
Any gain on the sale of the property may need to be apportioned between the new build land and the non-new build land. The apportionment must be done using a land area test. This means a valuation-based apportionment approach cannot be used.