In the ACT, a seller(s) of a residential property must prepare a contract for the sale of residential property (marketing contract) prior to the property being offered for sale. This is usually undertaken by a solicitor or conveyancer. Certain conditions must be included in the contract and if this is not done, the law will ‘imply’ them into the contract meaning that the property seller(s) is bound by them even though they are not specifically written into the contract.
The marketing contract must be available for prospective buyers to consider prior to them making an offer to purchase the property. The marketing contract is required to include certain documents which provide a prospective buyer(s) with the legal and technical details they may need to know about a property before they make an offer. Such documents include a title search of the property, a building inspection report, a pest inspection report, a compliance report, an Energy Efficiency Rating (EER) Report. For strata tile properties such as apartments and townhouses, certain documentation is required to be provided regarding the Units Plan and Owner’s Corporation of the complex.
A typical process in selling a residential property in the ACT would be:
- Contract preparation: Have a contract for the sale of residential property prepared and the relevant inspections, documents and searches undertaken/prepared.
- Select and appoint a real estate agent: Interview an agent or agents to determine who you wish to appoint to act on your behalf for the sale of your property. Once you have selected your preferred agent, they will require you to sign an agreement which appoints them to act for you throughout the sale process.
- Prepare the property for sale: Undertake a review of your property as to how it may be received by prospective buyers. Remove the negatives where possible and try to create a welcoming ambience. Declutter and undertake any required cleaning, gardening and general maintenance.
- Receiving and accepting an offer: If a buyer(s) is interested in purchasing your property they will generally make an offer to your real estate agent who is legally obligated to convey this offer to you. After consideration of an offer, you may either accept the offer; decline the offer outright; or make a ‘counter-offer’ to the buyer(s) for a revised sale amount that you would be willing to accept. Once you have accepted an offer, the buyer(s) will proceed towards exchanging contracts which usually occurs within 10 business days.
- Exchanging contracts: An exchange of contracts occurs when a contract signed by a buyer(s) is handed over in exchange for a contract signed by the seller(s). This process is usually conducted between solicitors/conveyancers representing each party. It is at this stage that a deposit (usually 10% of the purchase price) must have been paid by the buyer(s) and that legally binding contractual obligations are made on each party.
- Pre-settlement Inspection: A buyer(s) is entitled to inspect the property they are purchasing about one week prior to settlement, or at reasonable other times with reasonable notice. These inspections are usually arranged through the real estate agent and are conducted to ensure that the property is in substantially the same condition as it was when the offer was made initially and that any goods/items intended to be sold with the property remain at the property.
- Settlement: The finalisation of the sale usually occurs at settlement once all the relevant checks have been made, the property title and transfer documents exchanged, and the balance of the purchase price has been paid to the seller(s). Once settlement is completed the buyer(s) obtains the keys and takes possession of the property. At this point the property seller(s) have usually vacated and cleaned the property.
Disclaimer
Information contained within and/or provided by this site is purely general real estate information in nature and is not intended to be – nor should be taken to be – legal advice or accounting/financial advice of any kind. You should always seek appropriate legal and accounting/financial advice from a qualified practitioner. Any reliance on the information provided by this site is solely at your own risk.