Home buyers warned about third-party LIM providers

Prospective home buyers are being warned about getting LIM reports from third-party online providers which are charging hundreds of dollars more than local councils for the same service.

The Whanganui and Waitaki district councils have both gone public about the issue, pointing out one website is offering Land Information Memorandums (LIMs) up to five times what they charge for a standard LIM.

After being alerted to third-party LIM services, Property Brokers Whanganui branch manager Vicky Todd went online to check one out.

"You can click through and apply for a LIM report there. The unfortunate thing about that is it's a third party and they are charging $1299 for a LIM report.

"They then apply for it from the council and they take $1000 of that because the LIM report's only $300 at the council. Always go directly to the council."

Todd said at a time when first home buyers were counting every cent, it was concerning some might sign up for such services.

"Look, it's not great. You know, we recommend, always recommend a LIM report, which is a Land Information Memorandum from the council, always.

"But this is just, this is an exorbitant cost by a third party who does nothing for it."

Waitaki District Council had also highlighted the issue.

Director of natural and built environments Roger Cook said it was urging prospective home buyers to avoid expensive third-party providers.

"Very often your real estate agent can get a LIM for you or your solicitor can get it for you, but you don't actually need to pay anybody to get it.

"You can just go on to, in Waitaki's case, an online form, pop in the address in question, pay the money online, pay the fee online, and then the report is emailed to you. So it's very straightforward."

Cook said people should be wary and do their due diligence.

"Do your checks and see what the local authority price is. They would be published on their websites. And, you know, as I say, you don't need a third-party provider to do it for you."

In a statement, Waitaki District Council said a third-party site was offering a residential LIM in its area for $1299 when the council charged $440 for them, a 195 percent mark up. There was a further $299 charge for a rapid service.

The third-party service charged $2499 for a commercial LIM when the council charged $585, an increase of 327 percent.

A simple property file from council normally cost owners $15 or $45 for non-owners while the third party charged $499.

Netsafe chief online safety officer Sean Lyons said the third-party LIM services were not necessarily breaching any rules.

"It's somebody offering a service that I guess isn't a service and it might not be illegal to do that, it might not even be a scam, but it is very much a sort of a buyer beware situation where you should ask yourself what am I paying for here."

He said there were some basic questions people should be able to answer before engaging with such services.

"Let's say the service is available to the general public for $100 and somebody says I can do that service for you for $2000. Well that's fine, but what's the value between the $100 and the $2000 and that's the question people have to answer."

In the meantime, the advice was to get LIM reports from your local council.