Introduction

When it comes to property transactions in South Australia, the Contract of Sale stands as the cornerstone. The Contract of Sale encapsulates the terms and conditions agreed upon by the buying and selling parties involved. The Contract of Sale outlines the full property details and legal land description and as it clarifies the obligations of each party to the purchase and sale, the Contract of Sale plays a pivotal role in ensuring a seamless transfer of ownership, free of any uncertainty.

It is important to remember that each state in Australia has its own rules for land transfers and conveyancing. In this article, we’ll explore what is contained in a Contract of Sale, and we’ll explain the importance and complexities contained therein to help you navigate the intricacies of the South Australian property market with confidence.

Who Prepares the Contract of Sale?

The responsibility of drafting the Contract of Sale in South Australian conveyancing primarily lies with the seller. The preparation of the Contract can be outsourced to a third party like Eckermann Property Forms and Services or, in other instances, if a real estate agent is engaged to the sell the property, they may undertake preparing the Contract themselves. There are companies that provide subscription-based services for templated documents for the use of real estate agents. In the case of a private sale where there is no sales agent involved or for more complex transactions that might not be suited to a templated solution, conveyancers or lawyers can assist in preparing the Contract of Sale to ensure compliance and accuracy.

At Eckermanns, our team of dedicated professionals understands the intricacies of South Australian property law. Whether you’re buying or selling, our conveyancers in Adelaide are here to streamline the process and safeguard your interests and with more than 45 years’ experience in the industry, you can be assured they are experts.

What is Included in the Contract?

A standard Contract of Sale comprises several crucial components that safeguards both parties’ interests. Here’s a breakdown of its key components:

  •  Particulars of the Parties: This section identifies the buyer(s) and seller(s), along with their contact details and ABN if there is one required.
  • Property Details: It includes a detailed and legal description of the property being sold, including its address, Certificate of Title Volume and Folio number, and where a Strata, Community or Deposited or Filed Plan is relevant this will also be outlined.
  •  GST Conditions of Sale: this outlines if GST applies and where it does, it details if GST is contained in the Purchase Price.  
  • Purchase Price and Deposit: The agreed-upon purchase price, GST if applicable and the deposit amount are clearly stated, along with any requirements around the timing of the payment of the deposit amount.
  • Settlement Terms: This outlines the settlement date and conditions for settlement, including the date of possession and the timing for the satisfaction of any special conditions agreed by the parties. It also outlines inclusions and exclusions. Exclusions comprise things like loose floor coverings, potted plants, garden ornaments and any other items the vendor wishes to be excluded from the sale. It will also mention known encroachments and fences not on boundaries and details of any alterations or improvements that have been erected without consent. If the vendor commits to undertaking works prior to settlement, this will also be detailed.
  • Vendor’s Statement (Form 1): this document provides essential information about the property, such as zoning, title details, and any encumbrances. It may be served with the Contract but if not, the Cooling off period for the purchaser will not begin until the Form 1 has been served. In South Australia, a cooling-off period may apply, allowing the buyer a limited window to withdraw from the contract without penalty.
  • Special Conditions: Any additional terms or conditions agreed upon by the buyer and seller are outlined in this section, covering aspects like finance approval, if the purchase is subject to the sale of another property or a satisfactory building inspection.

Each of these components plays a pivotal role in shaping the rights and obligations of both parties, underscoring the importance of thorough review and understanding.

How Long Does it take to Review a Contract of Sale?

The duration of a contract review can vary depending on several factors. In South Australia, the review process typically takes anywhere from a one day to a week depending on the capacity of the lawyer or conveyancer undertaking the review. The timeframe can also be influenced by the complexity of the transaction, the responsiveness of parties involved, and the specific conditions outlined in the contract. It is wise to contact your conveyancer early to flag that you will be requiring a contract review.

What Happens After a Contract of Sale is Signed?

Once the Contract of Sale is signed by both parties, the following steps ensue:

Cooling-Off Period: In South Australia, a cooling-off period of two full business days applies to residential property transactions, during which the buyer can withdraw from the contract without penalty. That withdrawal must be in writing although an email withdrawal is considered acceptable. Consider applying a read receipt to any email and do note that if you purchase your property at Auction, a cooling off period does not apply. An Auction Contract is unconditional.

  • Deposit Payment: The buyer is required to pay the deposit as specified in the contract, and that deposit is usually held in trust until settlement.
  • Fulfilling Conditions: Any conditions outlined in the contract, such as obtaining finance approval or conducting inspections, must be fulfilled within the specified timeframe.
  • Settlement: On the agreed settlement date, the balance of the purchase price is paid, and the transfer of ownership is completed. Eckermann Conveyancers in Adelaide facilitate this process, ensuring a smooth transition of property ownership from the vendor to the purchaser.
  • Key Handover: With settlement completed, the keys are handed over to the buyer (usually by the sales agent), marking the culmination of the transaction.

 

Conclusion

Understanding the ins and outs of a Contract of Sale is crucial in the South Australian property market. It’s the key to a smooth property transaction, ensuring clarity and certainty for both buyers and sellers. At Eckermann Conveyancers in South Australia, we’re dedicated to guiding you through every step of the sale and purchase process with expertise and care.

Contact Eckermann Conveyancers today to embark on your property journey with confidence.