If you have engaged a real estate agent to sell your property then make sure you arrange for a contract for sale of land to be prepared by your conveyancer or solicitor before the agent starts their marketing campaign. Your property can’t be advertised by a real estate agent until a Contract for Sale of Land has been prepared. In order to prepare your contract, you will need to obtain all the “prescribed documents” such as a council zoning certificate, a copy of the title and other title documents, strata plans and sewer diagram. The contract can usually be prepared in around 5 business days.

When a strata unit is advertised and purchased before the building process has begun, it is referred to as buying ‘off the plan’. There are many issues that can be encountered with an off the plan purchase, which is why it is imperative to work with a solicitor or licensed conveyancer who will ensure the risks are mitigated.

You need to understand your on your rights and responsibilities prior to purchasing an off the plan house or unit, your conveyancer or solicitor will discuss and explain the terms of your contract, ensuring that you clearly understand it’s terms and conditions. 

Some of the most important considerations when buying off the plan include:

• Whether there are penalties from withdrawing from a contract.
• Whether the developer can make changes to the unit.
• The risks involved with a purchase that is subject to financing.
• Whether on-selling is allowed.
• How long a developer can delay settlement.
• Issues and risks relating to building defects.

Despite there being risks involved in purchasing a strata unit, the benefits are appealing to many home buyers. Some of the greatest advantages include benefits with off the plan stamp duty and finance. Your conveyancer or solicitor when assessing your current circumstances, will advise you on whether you are eligible for government benefits (such as a first-home buyers grant), as this can have a significant impact on stamp duty. 

Typically, 10% of the purchase price is the deposit paid on exchange of contracts. However, this may be negotiated before exchange to accept a 5% deposit, bank guarantee or deposit bond. Most cash deposits are held in an interest bearing account arranged by the agent with the interest being split 50/50 between the purchaser and vendor after settlement. If there is no agent involved on the sale then the deposit may be held in your conveyancers or solicitors trust account.

Your real estate agent should let you know when an offer is given by a prospective purchaser. Once you’ve accepted an offer, the agent will issue a sales advice to all parties with details of the agreed price and possibly some special conditions that have been agreed. The contract is binding when contracts are exchanged and a deposit is paid and is then legally binding.