Relationship property and separation
After three years together, the family home is usually shared equally no matter whose name is on the title or who paid the deposit. That is the law, not a choice. If one of you is contributing much more, or you are buying into a partner's existing home, a contracting-out agreement is how you change the default.
What it is
Under the Property (Relationships) Act, once a marriage, civil union or de facto relationship reaches three years, the family home and family chattels are generally divided equally on separation. Contributions before the relationship, gifts from parents and inheritances can lose their separate character once they go into the home. A contracting-out agreement, signed with independent legal advice on both sides, lets a couple agree something different.
Why it matters
Most first home buyers are in exactly the situation the Act is designed for: one partner with more savings, parents helping one side, or one partner already owning a home the other is moving into. Nobody plans to separate, which is why the conversation is uncomfortable and why the cost of skipping it is so high.
How we handle it
We raise it early, without drama. If a contracting-out agreement makes sense we explain what it needs to say and arrange independent advice for your partner, which the law requires. If you are buying into a partner's home we run the LOV UP process so the transfer, the KiwiSaver and the finance all line up. If you are separating and settling at the same time we coordinate both so neither falls over.
Common traps
- Assuming the deposit comes back to whoever paid it.
- Signing a contracting-out agreement without independent advice. It will not hold.
- Keeping the house in one name to protect it. After three years that protects nothing.
- Leaving the separation agreement until after the new purchase has gone unconditional.
Not sure how this applies to you?
A free 15-minute call with a property lawyer who only works with first home buyers.