Residential property cannot be offered for sale until a contract of sale has been prepared. An agent is considered to offer residential property for sale when the agent (expressly or by implication):
- indicates that the property is for sale or will be auctioned
- offers to sell the property
- invites an offer to purchase the property
- indicates that a person may be willing to grant an option to purchase the property.
The draft contract must be available for inspection at the agent’s office. The documents required by section 52A of the Conveyancing Act 1919 must be attached to the contract include:
- certificate of title
- drainage diagrams
- the planning certificate issued by the local council
- any dealings on the lot relating to an easement, profits à pendre, restrictions on the use of land or positive covenant
- a notice with respect to smoke alarms and loose-fill asbestos insulation (unless the notice is printed in the contract)
All required documents are prescribed in Schedule 1 of the Conveyancing (Sale of Land) Regulation 2017.
For properties sold off the plan, additional documents must be included in the contract, including a Disclosure Statement which outlines key information. Other documents to be provided include:
- a draft plan prepared by a registered surveyor
- any proposed schedule of finishes
- any dealing proposed to be lodged with the plan
- draft by-laws
- for lots in a proposed community, precinct or neighbourhood scheme - the draft management statement and any proposed development contract
- for properties that comprise or includes a lot in a proposed development scheme, the draft strata development contract
- for a proposed strata scheme, a draft strata management statement
- any draft building management statement.
If you fail to attach one of these documents to the sales contract before it is signed, the purchaser may rescind the sale contract within 14 days of exchange.
The contract must also include any property exclusions and the prescribed statement relating to the cooling off period.
If the property for sale has a swimming pool or spa pool, one of the following must also be attached to the contract:
- a copy of a valid certificate of compliance, or
- relevant occupation certificate and evidence that the pool has been registered, or
- a valid certificate of non-compliance.
Visit the NSW Swimming Pool Register website to check if the property with a swimming pool or spa has a current certificate of compliance.
This requirement does not apply to:
- lots in strata or community schemes that have more than two lots, or
- any off the plan contract.
Generally, all agents who offer a property for sale must have the proposed contract for the sale. However, where a conjunction agreement exists, it is only necessary for the listing agent to hold the sales contract, provided conjunction agents have access to the contract as necessary.
Exchange of contracts
The exchange of contracts is a critical point in the sale process, for these reasons:
- buyers and sellers are not legally bound until signed copies of the contract are exchanged
- buyers of residential property usually have a cooling off period of five working days following the exchange of contracts, and during this time they can withdraw from the sale
- if the agent arranges the exchange of contacts, 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 required to uphold the agreement
- there is no cooling off period when purchasing at auction.
An agent may participate in the exchange or making of the contract for sale of residential property unless their client has notified the agent, or the proposed contract indicates, that a solicitor or conveyancer will be acting on the client’s behalf. In these circumstances, the client or their lawyer must provide express authorisation for the agent to take part in the exchange or making of the contract.