A private seller is someone who is not in trade. For example a private seller may sometimes sell goods on an auction website, in a garage sale or at a school fair.

A trader is, in comparison, someone (or a company) whose business or earnings are primarily derived from making sales to the public.

Example of a private seller

Kate has a young son. She sells online the clothes he has outgrown. Despite selling a lot of her son’s clothes online, Kate is not in trade because the clothes she is selling were initially purchased for personal use.

In general, private sales are not covered by the Fair Trading Act or the Consumer Guarantees Act. This means you can’t obtain a remedy in the same way if the goods are faulty, or if you’ve been misled or given false information.

There are exceptions where the seller is using unfair selling practices such as pyramid selling or demanding or accepting payment for goods without intending to supply. Importantly too, some goods have to comply with product safety standards even if second hand (such as cots and children’s nightwear).

Private buyers who have a grievance about their purchase are, however, able to make a claim in the Disputes Tribunal. The Tribunal charges a small fee to lodge a claim.

Tips for buying privately

  • If it sounds too good to be true it often is, so be wary. When the deal's a 'real steal' or the item needs to be sold quickly, ask the seller why? Could the cheap designer shoes be fake?
  • Look for feedback from other customers about the seller, such as on a Facebook page, on Trade Me ratings or other message boards.
  • It is good practice to retain the seller's contact details (phone and address) so you can contact them to try and resolve an issue if things go wrong.
  • If possible inspect the goods before you buy and ask the seller to point out any damage or faults. This is especially important for more expensive purchases, where you will be in financial difficulty if the purchase goes wrong.
  • See if the product has a current manufacturer's warranty that you can take over.
  • Think about using an independent payment service like PayPal or as used by Trade Me, where you pay a third party who doesn't release the money until you receive the goods. If not, pay by credit card, online banking or money order so your payment can be tracked.
  • Check if money is owed by the seller on bigger items like appliances and second hand cars by searching the Personal Property Security Register (PPSR).
  • If you are buying a car privately you should be careful as you have less protection than if buying from a trader, so it may be wise to get peace of mind by getting a mechanic to check the vehicle.

Private sales covered by the Contract and Commercial Law Act

This means that goods must:

  • match the description or the sample of the item given by the seller
  • be delivered within a reasonable time period, if delivery is part of the sales contract but no time-frame was agreed beforehand.