Buying a property in Queensland is likely the largest transaction you’ll ever make. It takes special care to ensure your rights are protected throughout the conveyancing process.
Conveyancing is the legal process of transferring a property from the seller to the buyer. For most people, it means the process of buying a new home or selling the old one. Conveyancing is a process that involves many legal aspects that you need to take care of. We broke the process into several steps to explain it better to you and help you avoid the legal traps along the way.
The Contract
When you find the property you want to buy, it is time to make an offer to the seller. It is usual in Queensland for offer to be made by signing the formal contract, rather than a letter of offer of expression of interest.
Most Queensland property is bought and sold using the ‘standard’ Real Estate Institute of Queensland (REIQ) contract. We highly recommend you speak with McAndrew Law before signing to ensure your rights are protected. A complimentary contract review is included as a part of our Brisbane conveyancing service.
Depending on your needs and the property you’re buying, the contract may require special conditions or amendments. You should ensure these issues are dealt with before you sign a formal offer.
Once the contract has been negotiated and signed by both parties, the conveyancing process then begins.
Searches
Queensland conveyancing is based on the principle of ‘caveat emptor’, better known as ‘buyer beware’. This system means that the buyer is responsible for carrying out its own due diligence on the property to ensure there are no issues and ensuring the contract is drafted to allow you to terminate the contract if issues are discovered.
But why didn’t the seller tell me about the issues? Seller’s are generally not required to make any disclosure about defects in the property to you.
Consider this, the seller may have constructed an extension out the back of the property or built a new carport on the front without obtaining Council approval or ensuring the structures comply with building standards. If Council discovers these unapproved structures, they may require them to be removed without any compensation to you. You can read more about protecting yourself from unapproved structures and your rights here: Unapproved Structures.
The conveyancing searches that we carry out depend on the nature of the property being purchased and the amount that you are willing to spend to ensure you are not buying a lemon.
The main searches carried out are:
- Title search – this is to ensure you are buying the property from the true legal owner and that there are no defects noted on the title.
- Survey plan – this is to ensure that the property you are buying is the same as the property you expect and that there are no defects noted on the plan.
- Council – this is required to allow for an adjustment of Council rates at settlement to ensure you are not taking over any unpaid rates from the owner. Many Councils offer different levels of searches from financials only through to information regarding enforcement notices.
- Water authority – this is required to allow for an adjustment of water and sewerage charges at settlement to ensure you are not taking over unpaid charges from the owner.
- Land tax – this is required to ensure you are not taking over unpaid land tax levies from the owner.
- Building records – this assists in determining whether the property has all of the required building approvals.
Further information on common conveyancing search and the costs can be found here Conveyancing Searches.
Ensuring the proper conveyancing searches are carried out is one of the most important aspects of the Queensland conveyancing process.
The Deposit
As soon as the contract is signed by both sides and the conveyancing process begins, it is time to pay the deposit.
The buyer will have to transfer the funds within the time limits set in the contract. If the deposit is not paid when due, the seller will have certain rights against the buyer, including a right to terminate the contract.
One of the most common issues we see is buyers transferring the deposit on the day it is due and funds not clearing on the same day. This means that the buyer is technically in breach of the contract for failing to pay the deposit on the due date.
Cooling-off Period
Unless you have bought the property at auction, you will usually have a cooling off period that allows you to terminate the contract if you change your mind within the first five business days.
If you choose to terminate under the cooling off period, the seller can retain a termination penalty of 0.25% of the purchase price from any deposit that you have paid. Something that a lot of people (including lawyers) don’t realise is that the seller cannot retain a termination penalty if a deposit has not been paid.
Notices terminating under the cooling off period require special wording and should be prepared by a lawyer to ensure your termination is valid.
Want to know more?
If you think all Brisbane conveyancing lawyers are the same, then think again. Going the extra mile to ensure your new home has the relevant approvals for all improvements is part of the McAndrew Law conveyancing service.
Please don’t hesitate to call us on 07 3266 8555 or submit a query below if you have any questions and we would be happy to assist.
