Acquisition
Due diligence
This stage verifies the site before the developer confirms purchase, waives conditions, or spends heavily on design. This page shows what a beginner residential developer in Auckland should check, who to ask, what evidence to save, and where to verify before committing money or instructions.
due diligencetitleLIMproperty fileeasement9 roles
What this stage means
- Due diligence is the part of the project where the developer turns an idea into a checked decision, not a guess.
- The stage should connect market demand, planning rules, legal constraints, design, cost, funding, time, risk, and exit strategy.
- For Auckland residential development, the answer is site-specific. The same idea can be low risk on one site and unworkable on the next because of zoning, overlays, title interests, services, slope, flooding, neighbours, or finance.
Why this stage matters
- Early mistakes become expensive because land, design, consultants, holding costs, consent fees, and finance costs continue even when the project is paused.
- The developer needs written evidence for lenders, consultants, lawyers, valuers, builders, purchasers, and future dispute protection.
- This stage usually needs verification from Auckland Council property reports, Auckland Council LIM report, Auckland Council property file, Toitu Te Whenua LINZ land records, Relevant professional advice before the developer treats the conclusion as reliable.
Step-by-step guide
- 1Define the decision needed at the end of this stage and the date it is needed by.
- 2Gather the stage documents: Record of Title, LIM, Property file, Sale agreement, and the remaining stage records.
- 3Read the documents once for understanding, then again to list unknowns, risks, contradictions, missing evidence, and professional questions.
- 4Ask the responsible professionals to confirm the critical points: Lawyer, Planner, Surveyor, Architect.
- 5Update the feasibility, programme, risk register, and decision register with source references and dates.
- 6Decide whether to proceed, pause, redesign, renegotiate, add conditions, seek more advice, or abandon the option.
- 7Save the evidence in a dated folder and write a short stage closeout note explaining what was decided and why.
What the developer must do
- Write down the development objective for due diligence in one clear paragraph: build-to-sell, build-to-rent, retain one dwelling, subdivide, renovate, or staged development.
- Open the current feasibility, programme, decision register, risk register, and due diligence folder before making new commitments.
- Collect the documents needed for this stage: Record of Title, LIM, Property file, Sale agreement, Planning memo, Survey/geotech/civil notes, Building inspection.
- Send focused questions to the right people: Lawyer, Planner, Surveyor, Architect, Engineer, Building inspector, Accountant, Lender, Valuer.
- Record assumptions separately from verified facts so the feasibility does not look more certain than it really is.
- Update cost, time, consent, finance, and sales assumptions immediately after receiving new information.
- Escalate anything that changes yield, sale price, cost, timing, consent pathway, title, funding, or settlement risk.
Source / Where to check
Use Auckland Council property report pages to order or understand LIM reports, property files, custom resource consent reports, and related property information.
Use the LIM to check council-held information relevant to the land. Treat it as one due diligence document, not a substitute for title, survey, planning, engineering, legal, or finance advice.
Review historic building consents, drainage plans, previous approvals, CCC records where available, and historic plans. Compare records with what physically exists on site.
Use LINZ, a lawyer, and a licensed cadastral surveyor to verify Record of Title, legal description, interests, easements, covenants, consent notices, survey plans, and boundary/title matters.
Relevant professional advice
Planner, surveyor, architect, engineer, quantity surveyor, lawyer, accountant, lender, valuer, real estate agent, and other project specialists must confirm site-specific decisions.
Common mistakes
- Treating an agent comment, generic online rule, or old document as verified site-specific advice.
- Forgetting to update the feasibility after design, consent, finance, or market information changes.
- Not allowing enough contingency, professional fees, council fees, finance costs, holding costs, and time risk.
- Failing to keep written records of who confirmed what and when.
- Using due diligence to push ahead even when the red flags show the project should pause.
Common risks
- Yield reduces after proper planning, engineering, title, or infrastructure review.
- Costs increase after QS, builder, civil, geotechnical, demolition, asbestos, or consent information is received.
- Programme moves out because consultant inputs, council RFIs, neighbour issues, finance, title, or construction sequencing take longer than assumed.
- Funding or sales assumptions change before the project reaches settlement.
- The developer relies on unverified information and loses negotiating power or misses a due diligence deadline.
Common costs
- Professional fees for planner, architect/designer, surveyor, engineer, QS, lawyer, accountant, valuer, and lender reports.
- Council fees, consent fees, development contribution estimates, engineering approvals, infrastructure checks, and inspection/monitoring costs where relevant.
- Design revisions, reports, investigations, demolition/asbestos work, service location, geotechnical testing, and valuation updates.
- Holding costs such as interest, rates, insurance, utilities, temporary maintenance, and security.
- Contingency for unverified conditions until the relevant professional confirms them.
Common delays
- Waiting for property file, LIM, title instruments, survey information, consultant reports, or council responses.
- Design changes caused by planning controls, infrastructure constraints, engineering findings, budget pressure, or market feedback.
- Lender, valuer, lawyer, or purchaser conditions not being satisfied on time.
- Council RFI responses needing more consultant work than expected.
- Construction or subdivision closeout documents not matching settlement or sales deadlines.
Common consultant questions
- For Due diligence, what are the three highest risks that could change cost, time, yield, or approval pathway?
- Which parts of your advice are confirmed, which are assumptions, and which require another professional to confirm?
- What documents did you rely on, and are any documents missing, outdated, superseded, or inconsistent?
- What decision does the developer need to make now, and what should wait until more information is available?
- What wording should go into the decision register, consultant meeting minutes, or lender/client update?
Red flags
- A professional says the issue is outside their scope and no one else has been asked to confirm it.
- The feasibility only works if optimistic sale prices, low construction costs, fast consent, low interest, and no delays all happen together.
- A title, planning, flooding, geotechnical, access, service, or covenant issue may prevent the intended yield.
- A seller, agent, builder, or consultant pressures the developer to waive due diligence before core checks are complete.
- The project file has no written evidence for a major decision.
When to stop and get professional advice
- Stop and get professional advice when title, easements, covenants, unit title, cross lease, or subdivision matters affect the proposal.
- Stop and get professional advice when zoning, overlays, activity status, notification, infrastructure capacity, flooding, geotechnical, contamination, or heritage could affect yield.
- Stop and get professional advice when GST, income tax, entity structure, lending, guarantees, or sale contract terms affect the decision.
- Stop and get professional advice when the developer is about to sign, waive a condition, lodge consent, start work, approve a variation, accept practical completion, or settle.
Decisions that must be made
- Waive, extend, renegotiate, add conditions, or cancel
- Which risks remain after purchase
- Whether professional advice is sufficient
Evidence to save
- Dated source documents and consultant advice.
- Feasibility version showing the assumptions used at the time of decision.
- Risk register and decision register entries.
- Meeting notes, emails, marked-up plans, calculations, photos, and council/lender/consultant responses.
- Clear note of who approved the next step and any conditions attached to that approval.
Beginner-friendly example
Due diligence finds an easement through the best building platform, so the developer asks the surveyor and lawyer whether relocation, redesign, or withdrawal is required.