Challenging unethical property development

Buying a home is one of the hardest things we will ever do. With skyrocketing costs and lack of quality properties, many of us are required to look further afield at new property developments.

The glossy brochures produced by these property developers depict neighbourhoods with parks and community facilities, designer homes, happy families and eternal sunshine. The truth is that the marketing material is the best-case scenario for your new home, and sometimes has little to no bearing on the reality. You may have paid a premium for a property across the road from a park, which two years later is now going to be a two storey supermarket. Or that small business hub on the development master plan is being replaced with a huge hotel for foreign tourists.

Many Kiwis pour their lifesavings into one of these new properties to get a foot on the ladder and a roof over their heads, only to find they have been outright misled about what they are buying by deceitful property developers.

Does this seem right? Surely a Developer can’t just ignore their own masterplan and change everything around your new house? Well they can; and they do; and most owners don’t realise until too late that they have signed their rights away by agreeing to a no-objection clause in their land covenants.

A no-objection clause is an agreement that the purchaser will not object to any changes the Developer may choose to make in the subdivision, regardless of the impact of the changes on the homeowner, or even what was shown on the subdivision design/master plan when they purchased. The homeowner is therefore deprived of their right to object under the Resource Management Act. Some no-object covenants extend the restrictions to denying a resident the right to take a civil case to the High Court

Developers in New Zealand are increasingly incorporating general no-object clauses in land covenants and Sale & Purchase agreements. Even when buyers are advised about a no-objection clause when purchasing, many people have no idea what this practically means and what they could be faced with if the Developer decides to make significant changes to their neighbourhood. If they do not agree to the clause, they are unable to purchase the home.

We believe these no-object clauses are unethical and potentially unlawful. While we started this cause against Winton's development of a large hotel in the small community of Northlake in Wanaka, it is still becoming apparent how extensively the no objection clauses are being adopted by developers throughout New Zealand.

On 16 July this group retained legal counsel and filed an appeal with the Environment Court against the Decision to build the hotel. We intend to challenge the no-objection clauses as being unethical, contrary to public policy and unconscionable. We believe a ruling against these no-objection clauses would set a precedent that will allow all New Zealanders in these developments to have their say and let unethical property developers know that they need to respect their residents and act for the benefit and wellbeing of the communities they create, rather than the financial wellbeing of a few