Preparation of contract of sale

About preparation of contract

A compliant contract of sale and section 32 is a legally binding agreement between buyer and seller. This document is typically prepared by the seller’s conveyancer or lawyer. Ordinarily, you would need to request a copy of the contract of sale or section 32 from the Vendor’s agent for your solicitor to review.

Details such as the purchase price and settlement period are usually finalised after negotiations between parties. Once all these are out of the way, the contract of sale is ready for signing!

The essential components of a contract of sale include:

  • the general conditions of the contract of sale
  • the special conditions of the contract of sale
  • details of the property (the description and dimension of the property being sold)
  • details about the parties (the names and addresses of the vendor/seller and purchaser/buyer)
  • details of the estate agent (if you’re using one)
  • details of both your and the seller’s legal practitioners or conveyancers
  • the purchase price (as agreed on with the buyer)
  • the required deposit amount
  • the date of settlement
  • the balance of purchase price which should be paid at settlement
  • items included in the property such as chattels and fixtures
  • penalties for breach of contract or delay in settlement
  • easements and restrictions (the right to use the land or property for a particular purpose)

More details include

Generally, a sunset clause is included in the contract of sale for an off-the-plan property. The clause specifies the time by which the plan of subdivision must be registered or even the build of the development. Either buyer or seller can walk away from the contract if the requirements of the agreement are not met by the specified date. However, developers or sellers are required to get the buyer’s written consent before they can terminate the contract of sale based on the expiration of the sunset date.

There are generally special conditions in a contract of sale and these are conditions outside of the general conditions in the contract. Ordinarily, these prevail if there is any inconsistency with the general conditions. Ordinarily, or at least first instance, they are generally for the benefit of the Vendor. Often, buyers forget or don’t know that these are often negotiable. It can potentially reduce your risk in the transaction and potentially save you thousands!

In Victoria, buyers generally have a 3-day cooling off period after signing the contract of sale (note that you do not have this in auctions). During this period, the buyers can change their minds and withdraw from the sale. Buyers who withdraw from a sale during the cooling-off period are entitled to a full refund of deposit minus $100 or 0.2% of the purchase price (whichever is higher).

The contract of sale is not a document that you can sign on a whim. You have to read through and understand the fine print to minimise the risk of getting stuck with an unfavourable deal.

Take advantage of our highly personalised services and cost-effective conveyancing fees. We can draft, review, negotiate, and execute contracts of sale for property transactions in Victoria. To get started, call us at +613 9959 9850 or email us at info@tnsconveyancing.com.au.

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How it works

Enquire

Request a free, no-obligation callback and one of our conveyancers will get back to you within 24 hours. Tell us what’s going on with your conveyancing transaction so we can assess your situation and give you a no-obligation quote.

Correspond

If you decide to proceed with us, we will contact you straight away. We will ask for some money in trust and moving forward, our conveyancing team will keep in touch via email and phone throughout the process.

Review

At the end of every transaction, we will ask you whether we have met the high-level conveyancing service you deserve, the same standards to which we aspire. If not, we will work with you to address any shortcomings immediately.

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