Buying Property in NSW: Contract Review & Conveyancing

Buying residential property in New South Wales involves legal, financial and practical decisions before contracts are exchanged. Russell Kelly & Associates assists purchasers with contract review, conveyancing, due diligence and settlement.

Review the Contract Before You Commit

The contract for sale records the legal terms of the transaction and includes information about the property and title. A review may identify matters concerning easements, covenants, zoning information, inclusions, settlement requirements, adjustments and special conditions.

Strata and community-title properties require additional consideration of the strata plan, by-laws, levies, insurance, records and potential building or financial issues. Buyers should also consider appropriate building, pest, strata and other specialist reports.

Finance and Due Diligence

Loan pre-approval is not necessarily the same as unconditional finance approval for a particular property. Buyers should understand the contractual consequences if finance, valuation or another required approval is not available before exchange.

Due diligence should be tailored to the property. It may include searches and enquiries concerning title, planning, drainage, land tax, strata records, contamination, building work or other matters relevant to the proposed purchase.

Private Treaty Sales and Cooling-Off Rights

Buyers of residential property by private treaty in NSW usually have a five-working-day cooling-off period after exchange. The period may be waived, shortened or extended in appropriate circumstances. Withdrawing during a cooling-off period can involve a financial penalty.

The contractual position depends on how and when contracts are exchanged. Advice should be obtained before agreeing to waive or shorten a cooling-off period.

Buying at Auction

There is generally no cooling-off period when property is purchased at auction, or when contracts are exchanged on the same day after a property is passed in. Contract review, finance arrangements and other investigations should therefore be completed before bidding.

Buying Off the Plan

Buying an off-the-plan property involves additional considerations because the lot, building or strata scheme may not yet be complete when the contract is signed. Purchasers should review the proposed plan, disclosure statement, draft by-laws, schedule of finishes, sunset provisions, expected completion arrangements and any rights concerning changes to the development.

NSW off-the-plan contracts generally have a 10-business-day cooling-off period and additional statutory disclosure protections. Material changes during the development can also give purchasers particular rights in some circumstances. Legal advice should be obtained before exchange because the contract may operate over a long period and finance, valuation and settlement conditions can change before completion.

See the NSW Government guidance on buying property off the plan and our information about Transfer Duty.

Deposit and Exchange of Contracts

The deposit, settlement date and other transaction terms are recorded in the contract. Although a ten per cent deposit is common, a different arrangement may sometimes be negotiated before exchange. Once contracts are exchanged, the parties become bound subject to any applicable cooling-off rights and contractual conditions.

From Exchange to Settlement

After exchange, the conveyancing process can include searches, enquiries, transfer-duty requirements, identity verification, preparation of settlement figures, lender coordination and electronic settlement through PEXA.

A final inspection is commonly arranged shortly before settlement. At settlement, the balance of the purchase price and agreed adjustments are dealt with and the transfer of ownership is completed.

How Russell Kelly & Associates Can Assist

We can review the proposed contract, explain significant terms, negotiate appropriate amendments, assist with searches and enquiries and manage the legal conveyancing process through to settlement.

Read more about our Property Law and Conveyancing services, Verification of Identity, PEXA and NSW Government buying-property guidance.

Buying Property in NSW: Frequently Asked Questions

Should I have the contract reviewed before signing?

Yes. A contract review can identify significant terms, title and disclosure issues, proposed settlement arrangements and matters requiring further investigation or negotiation before you become bound.

How long is the cooling-off period when buying residential property in NSW?

A residential buyer purchasing by private treaty usually has a five-working-day cooling-off period after exchange. It may be waived, shortened or extended, and withdrawing during the period can involve a financial penalty. Advice should be obtained before changing or waiving the cooling-off period.

Is there a cooling-off period when buying at auction?

Generally, no. A buyer who purchases at auction, or exchanges contracts on the same day after the property is passed in, will generally not have a cooling-off period. Contract review, finance arrangements and investigations should therefore be completed before bidding.

What happens between exchange and settlement?

The conveyancing process can include searches and enquiries, transfer-duty requirements, verification of identity, lender coordination, settlement calculations and electronic settlement through PEXA. A final inspection is commonly arranged shortly before settlement.

This information is general in nature and does not constitute legal or financial advice. Contractual rights and obligations depend on the particular property, contract and circumstances.