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High house prices resulting in prenups and ‘contracting out’ boom | Stuff.co.nz

“Relationship property law expert Lady Deborah Chambers, KC, said the number of prenups was increasing every year”. “They are definitely the way of the future,” she said.  “I don’t think it is killing romance, it’s just practical and sensible.”  Chambers estimates that in the past about 5% of marriages would have a prenup.  Now it’s closer to 25%. 

The reason Prenups are becoming more popular include:

1. Property increased. Many homeowners struggled to buy their first home and they know paying out their partner should the relationship end would mean keeping their home would be impossible. 

2. Clarity on how the relationship property will be divided making it easier, faster and less expensive should the relationship end. Separating property can be very complicated, especially when trusts and families are involved. 

3. More fair should there be inequal contributions toward relationship property such as one having a greater deposit towards a property.

4. Family Trusts and companies that used to be effective in protecting property are no longer bullet proof with the courts having the ability to “claw back” such property.

5. Many parents today will assist their children to purchase a property by gifting a portion of the deposit as part of their inheritance. These parents want to ensure the children’s partner cannot claim the inheritance.

6. Many also want to protect their hard-earned KiwiSaver.