This is a final draft of a MOU with the buyers (anonymised for this wider forum). There is a very small window for ticking this off so please respond by end of Sunday (Monday is the cut off date for making the offer).

DRAFT MOU

Purchase of 148 Tilley Road, Paekākāriki

The Parties

The Paekākāriki Housing Group (PHG) is a group of people from the Paekākāriki community who wish to establish ways to provide a range of housing opportunities in the community that enable people with a diversity of incomes, ages and situations to live in and be part of the community. The PHG have established a limited liability company (Paekākāriki Housing Limited) and are in the process of setting up the Paekākāriki Housing Trust to give effect to those goals. The goals of the PHG are available via the Paekākāriki Housing Trust website, www.paekakariki.org. In this MOU, “the PHG” includes the trust, the company or any other entity it establishes to give effect to its obligations under the MOU.

XX and XX (XXXX) support the broad aims of the PHG and the proposed Paekākāriki Housing Trust and wish to help with maintaining housing in the village for the Kingi-Warena whānau.

Purpose

To provide a clear understanding of the undertakings of the PHG and XXXX in relation to purchase of 148 Tilley Road. This purchase is being undertaken as an interim measure to provide housing for the Kingi-Warena whānau (the tenants).

This MOU also acknowledges the generous and valuable support provided by XXXX to an early project initiative of the proposed Paekākāriki Housing Trust.

Undertakings of the parties

XX and XX:

Will purchase the property at 148 Tilley Road, provided they agree a purchase price with the vendor.

Will hold ownership of the property for no more than 12 months from the purchase date to enable the PHG to facilitate a purchase of the property.

Will take out an interest-only loan to make the purchase. The initial loan will be for the purchase price at a fixed interest rate for 6 months. XXXX will reset the most desirable interest rate when this six-month term ends.

Will meet the legal and valuation costs of the purchase and the costs of rates and insurance on the property (not contents) for the term of their ownership.

Will meet the material cost of maintenance to the level required by building regulations and the Residential Tenancies Act 1986. Any maintenance or improvements over and above this level will be by mutual agreement between XXXX and the PHG.

Will allow the property to be rented to the Kingi-Warena whānau by the PHG for a year (or until such time as the property is sold) at a rental set by the PHG. Rental payments by the tenants will be made directly to the PHG.

Will sell the property to the PHG at the same price as purchased by XXXX, if the PHG are able to facilitate purchase of the property within 12 months.

May put the property back on the market after 12 months if the PHG is unable to facilitate the purchase of the property.

May put the property back on the market if the PHG does not meet its obligations to pay the required payments (equal to the interest-only payments on the loan) during the 12 months.

Paekākāriki Housing Group:

Will work to facilitate the purchase of the property off XXXX within 12 months of the date of purchase.

Will act as property manager of 148 Tilley Road. This includes acting as landlord for the property, including dealing with the tenant on any tenancy matters and managing all maintenance and remedial work required on the property.

Will make regular payments to XXXX equal to the interest-only payments on the loan held by XXXX for the purchase amount (regardless of the rental received).

Will provide and/or pay for labour for undertaking maintenance of the house for the period it is owned by XXXX.

Will work with XXXX to, where possible, minimise the costs of any materials that XXXX need to purchase to meet their maintenance requirements.

Basis of resale in one year’s time

The PHG will have first option to purchase the property within 12 months from the date of purchase, at the original purchase priced paid by XXXX.

If the PHG does not purchase the property within 12 months, XXXX may exercise their options in regards to sale and XXXX's obligations to the PHG and the tenants ceases.

If the property sells at less than the original purchase price, the PHG will not be liable for this loss.