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ATO targeting property investors
A recent taxpayer alert [Trusts mischaracterising property development receipts as capital gains] concerning property development and the use of trusts is significant for property developers. Taxpayer Alert 2014/1, describes an arrangement whereby a trust undertakes property development activities as part of its...
Chinese regulators may turn off the money flow that is funding the Australian real estate bubble
A Chinese Government crackdown on the recently exposed activities of the Bank of China's money laundering efforts in Australia will have repercussions on the sustainability of high property values in Sydney and Melbourne. China’s state broadcaster CCTV has launched an attack on one of the country’s most...
Changing A SMSF Trustee to a Corporate Trustee
Benefits of a Corporate Trustee 1. Changing Members If an SMSF is set up with a corporate trustee structure you can add a member (e.g. a spouse or child) or remove a member (e.g. if a member dies or can no longer act as trustee) with much less hassle than an individual trustee structure. If there is a ch...
Our Legal Fees & Services
At GMH Legal we believe that client relationships matter more than time sheets which is why we offer a range of alternative fee arrangements to best suit your needs. Our focus is on client service and establishing mutually rewarding relationships with our clients. We think that billing by the hour does not ...
Homebuyer’s Guide to Conveyancing
Buying your first home can be a confusing process, particularly when it comes to conveyancing. Taking your first step on to the property ladder can be an exciting time. But for those who have never been involved in a property purchase, the conveyancing process can often seem hard to understand. What i...
PREPARATION OF CONTRACTS FOR SALE OF PROPERTY
In New South Wales a residential property cannot be put on the market and advertised for sale until a Contract for Sale has been prepared.
If a seller does not provide a contract in preparation for a sale then an estate agent or agent’s representative usually completes a contract on their behalf.
Documents included in the Contract for Sale
The seller must provide the following documents with the contract:
- A Section 149 Certificate from the local council (‘zoning certificate): Shows planning controls and other things which may affect the property such as road widening.
- A sewerage/drainage diagram: Shows the location of any sewer lines on the property
- A copy of the title folio from the Land and Property Information NSW: Confirms that you own the property
- Copies of all documents creating easements or restrictive covenants: A cooling-off statement; A notice directing parties to the Conveyancing Act 1919 (section 52A) and the Conveyancing (Sale of Land) Regulation 2000.
If the above mentioned information is not attached, the buyer may be entitled to cancel the Contract within 14 days of exchanging it. The buyer may also reserve the right to cancel if the seller breaches certain warranties required by the Vendor Disclosure and Warranty Regulation.
Please note that if you are selling a strata title property, you will also need to include the following documents in the Contract:
- A copy of the property certificate for the lot and common property
- A copy of the strata plan by showing the lot
- A copy of any change of by-law affecting the use of common property
Exchange of contracts
Exchanging sale Contracts is the legal part of selling a home and happens regardless of whether you sell your property by private treaty or auction.
There will be two copies of the sale Contract: one for your and one for the buyer. You each sign one copy before they are swapped or ‘exchanged’.
This can be done by hand or post and is usually arranged by your Solicitor, conveyancer or the agent. At the time of the exchange, the buyer will be required to pay a deposit, usually 10% of the purchase price.
The Contract exchange is a critical point in the sale process:
- The buyer or seller is not legally bound until signed copies of the contract are exchanged
- Buyers of residential property usually have a cooling off period for five working days following the exchange of contracts during which they can withdraw from the sale
- If the agent arranges exchange of contracts, the agent must give copies of the signed contract to each party or their solicitor or conveyancer within 2 business days
- The cooling off period can be waived, reduced or extended by negotiation
- There is no cooling off period for sellers. Once Contracts have been exchanged, sellers are generally not bound to complete the agreement
Please note that there is no cooling off period when purchasing at auction.
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