When selling a property, the rules of exactly what has to be disclosed changes from State to State.
Queenslander sellers don’t have to provide as much property disclosure information or documents to the buyers as they do in other states. Instead, seller are required to comply with a complex mixture of common law, and statutory and contractual obligations.
As an agent we need to use our judgement about when to disclose material facts. Facts of a non-sensitive nature such as the area of the land on which the property stands should be provided in the standard marketing campaign, whereas more sensitive information may be more appropriately revealed when a buyer appears to be seriously considering purchasing the property.
Sellers in Queensland are only required by law to:
- Give a disclosure notice to a prospective buyer if the property has a pool and there is no pool safety certificate. There is also an obligation to provide a pool safety certificate or notice of no pool safety certificate to a buyer before settlement.
- Advise the buyer whether the property has compliant smoke alarms. It is a requirement under new legislation that a property must have compliant smoke alarms installed prior to settlement, or an amount equal to 0.15% of the purchase price may be withheld by the buyer on or before settlement.
- an approved electricity safety switch.
- Disclose all encumbrances affecting the property.
- Notify the buyer if the property is recorded on the contaminated land or environmental management register, or if there is an application or an order about a tree on the property.
- Any neighbourhood disputes.
- If you are selling a unit or townhouse, you must provide the buyer with information about the body corporate via a Body Corporate Disclosure Statement.
- If there has been a death in the property an “Aware of Deaths” statement must be signed.
- Before settlement you must also obtain and give the buyer a clearance certificate from the Australian Taxation Office.
Apart from this there is very little additional information that must be provided…it’s basically a case of “buyer beware”. You must ensure you do your own research on a property ie contact the local council, etc.
A recent change to the standard REIQ Contract is Section 6.2 (1) which states: Either party may, at a time up to 4pm on the Settlement Date, extend the Settlement Date by giving notice under this clause nominating a new date for settlement which must be no later than 5 Business Days after Scheduled Settlement Date.
In plain English, this means that either the buyer or seller can extend settlement for up to 5 days from the agreed settlement date. This is a major change and has potential to leave someone homeless for up to 5 days until the property settle.
Does the property have to be cleaned prior to settlement?
We had an interesting situation recently with one of our sales. The buyers were from New Zealand and during the pre-settlement inspection they noted the house still had items left in the cupboard and yard, as well as the carpets hadn’t been vacuumed/cleaned and the house was basically in a “lived in” state.
The buyers requested their solicitor to withhold an amount from the settlement funds due to state of the property (which is apparently acceptable in NZ). However, as no stipulation was made in the contract for the property to be “cleaned” prior to settlement, the buyers had no recourse on the sellers.
Unlike a rental property which must have a bond clean including carpets and a pest control carried out, this is not a requirement when selling a property. The only requirement is that the property must be left in the same condition as at the time of the buyer’s inspection. Most people do the right and courteous thing and ensure the property is in clean state ready for the new owner to move straight in, but this is also something to think about when signing a contract.
Remember, if you need any help or advice, we are just a phone call away.
All the best, Simon.