James King, Principal Lawyer at Legitimate Solutions Legal, gives an insight into selling residential property in the ACT and NSW.
Why don’t we sell the House and move into a Unit? This has to be a common statement heard around Canberra. People are looking to sell large houses and make the move into an inner City Unit. No gardens to look after, lock the door on the Unit and head away on holiday, walk to restaurants and cafes. Sounds attractive.
Steps Before Marketing the Property
Make sure you select a good Real Estate Agent to help you market the property. You will be working closely with them and they can make a real difference in marketing your property.
You must have a Contract in place before marketing a residential property in the ACT and NSW. Let us know you are selling and we can start preparing the Contract. You will need to have Building, Pest and Compliance reports for an ACT property but not for NSW. Legislation requires us to include various documents in the Contract.
In the ACT the Seller (or Agent) arranges for Building, Pest and Compliance Reports to be prepared for us to include in Contract. In NSW the Buyers arrange their own reports. We prepare the Contract and send an electronic version to the Agent for marketing and to you as the Seller for your records.
Exchange & Cooling Off Period
Once you have an acceptable offer we update the Contract, provide a copy of the Contract to the other lawyers and meet with you to sign the Contract. Exchange creates legally binding obligations. Under legislation Agents can exchange Contracts but we suggest having the Lawyers exchange the Contracts following your instructions.
The Contracts have a five day cooling off period where the Buyer can rescind or change their mind. We usually include a Certificate for the Buyer’s lawyer to sign that waives the cooling off period.
Insurance
You should keep your insurance in place until the property is finally settled. Buyers have an insurable interest in the property at exchange and should arrange for a building insurance cover note or policy to take effect but you should also keep the property insured.
For unit title such as townhouses the Body Corporate arranges the building insurance.
Auctions
Auctions are a little different from private treaty sales with no cooling off period for registered bidders that bought at auction or after the auction but on the same day as the auction.
Selling at auction to a registered bidder or after the auction but on the day of the auction results in a binding exchange on that day.
Dealing with the Bank
If you have a Mortgage over the property we work in with you to ensure the Bank will release the title at settlement. You will have to sign a discharge request that authorises the Bank to receive funds to pay out your loan, discharge your Mortgage and hand over the title.
We assist with this process to make sure all is in order for settlement.
After Exchange
We work in with the other lawyers to ensure the general rates, water rates, land tax etc are paid and adjusted.
Settlement
We attend to settlement and collect the Certificate of Title from your Bank, provide the Title to the solicitors for the buyers, receive cheques from them and receive an order on the agent to release the deposit.
If the property is sold subject to a tenancy we provide a letter transferring the bond to the buyers.
The buyer’s bank registers the Transfer and their Mortgage over the property at the Land Titles Office to transfer the property from your name to the new owners.
We invite you to contact us to discuss selling a property.
This is general information only and should not be relied upon as legal advice.
Published 10 November 2017.
