Phone: 0411 561 099


Legal issues when buying or selling in Queensland


The way in which property is bought and sold in Queensland has undergone some change with the introduction of the Property Occupations Act 2014 introduced in December 2014.


1. Property Occupations Act 2014
2. Conveyancing
3. Forms used in buying or selling real estate
4. The Contract of Salewww.reiq.com/buying-selling/9-steps-to-selling-property/2-how-to-sell


Property Occupations Act 2014


Significant changes were introduced with this act in 2014.
Some of the most significant changes included:

  • Sellers or agents no longer need to attach a separate warning statement to a residential property contract. Instead, they must include a prescribed statement in the contract itself. It must be clear, obvious and legible directly above the space for the buyer’s signature.
  • 90 day limit for sole and exclusive agency appointments
  • five-day cooling-off period remains for all sales of residential property (except by auction) Buyers no longer need a lawyer’s certificate to waive or reduce their cooling-off period.

* Auctions- Agents are able to say that a reserve price exists for an auction of residential property. They still must not disclose the reserve price itself. Agents must not release a price guide for an auction of residential property.


Conveyancing


Conveyancing is the legal transfer of a property’s title from the seller to the buyer. Queenslanders have the choice of employing a solicitor to handle the conveyance or doing the job themselves. DIY kits are available. However, if this method is used please be aware that any problems associated with the conveyance may result in costly outcomes. Using a recommended solicitor will take the worry out of the process for you.


Whether you use a solicitor or decide to do-it-yourself, conveyancing still incurs costs such as searches at the Titles office, stamp duty and registration fees. Searches of zoning, and Titles will determine whether the property has any restrictions such as adverse planning, demolition orders, outstanding taxes linked to it, or encumbrances on Title such as easements.

Forms used in buying or selling real estate

For a complete list and explanation of all forms that you may encounter when buying or selling real estate in Queensland visit the Queensland Government Office of Fair Trading website. It outlines the changes made to the process of buying or selling real estate in Queensland with the introduction of new legislation in 2014.

 

When Listing Your Property for Sale

Appointments

There is 1 simplified form for clients to appoint a property agent – FORM 6. This replaced the 7 forms that previously existed.

Agents no longer need to:

  • state how they will perform their services
  • indicate the section of the appointment form that explains the different types of appointment.

The maximum term of appointment for sole or exclusive agency changed from 60 days to 90 days.

Before an agent performs any service for a client they must complete a PO FORM6. Failure to do this may result in a penalty and loss of commission. The client appoints a Real Estate Agent for the sale or purchase of property, land or business. This form also outlines the method of sale to be used, the commission structure agreed upon, and discloses any other fees, charges and expenses that may be incurred.

The limits on sale commission has been deregulated. Agents can negotiate any commission with their clients.


The Contract of Sale

The contract of sale is prepared by the real estate agent when a buyer wishes to make an offer on a property. If the offer and/or subsequent negotiation is acceptable to the seller, both parties sign this document. Buyers may seek independent legal advice, and will often make the contract subject to satisfactory building and pest inspection, finance approval etc.

The REIQ Standard House and Land Contract has been prepared in compliance with the Property Occupations Act 2014 and in conjunction with the Law Society of Queensland and is commonly used among real estate agents around Queensland. A sample copy of the REIQ Standard House and Land Contract is available for buyers who wish to familiarise themselves with a contract of sale before beginning their real estate transaction. We can also supply you with a copy of this document.

In the case of a property sold through auction it is important to get a copy of the contract before the property goes to auction. Properties sold ‘under the hammer’ are unconditional, and therefore definite. A solicitor will be able to advise you on conditions of the contract of sale before you begin bidding on the property.

Negotiation

Negotiating on a property can be stressful for both sellers and buyers. Emotional involvement makes objectivity difficult. Sellers often think that moving from their original asking price means they are “losing money”, while buyers are afraid of “going too high” in the heat of the moment.

It helps to remember that market value for any property cannot be scientifically established or arbitrarily insisted on. Neither the seller’s “I won’t take any less than…” or the buyer’s “This is my final offer” actually determine the price.

The price only becomes a reality when two parties agree to it and sign a contract of sale. In the course of negotiation, the seller’s desire to get the highest price is offset against the buyer’s desire not to pay too much. Neither party wants to miss out – sellers on sales, buyers on properties they have set their heart on.

The point or price that is neither too little nor too much is arrived at by small (usually!) adjustments until the two parties evolve to a position they find mutually satisfactory.

Ultimatums usually bring negotiations to an end. It is easy to forget that market forces dictate prices and sellers who say: “We need $x to buy what we want” and buyers who say “This is my one and only offer, take it or leave it” need to ask themselves whether they have based their figures on analysis of past selling prices for similar houses, and not on their own wishful thinking.

Whether you’re a buyer or a seller, keeping the negotiation going usually means you won’t get the door closed on the sale.

Where the balance of power lies in negotiations depends on the market. In a sellers’ market, sellers can and do make ultimatums and hold out for dream prices, while in a buyers’ market it is the buyers who have the upper hand in any negotiations.

Sellers who don’t negotiate because they don’t like a purchaser’s initial offer never find out the highest price their would-be purchaser is prepared to pay. (Sometimes the purchaser doesn’t know until they have negotiated their way there!). Even if the highest offer a purchaser makes is unacceptable, at least it provides a point of comparison for future offers.

The hardest sale to make is the one that comes along in the first days of marketing, especially if the sellers are inexperienced.

A seller will often reason that if Purchaser One is prepared to pay $x in the first week of marketing, then Purchaser Two will pay $x+ next week. They say things like,” If the first ad brings in this sort of response, what will the second one bring?” – as if price increases with time and exposure.

Many sellers don’t realise that a property attracts the greatest amount of attention when it is first presented. This is the time when a purchaser who falls in love with a property will be afraid that someone else will snap it up before they do. The longer a property is on the market at a given price, the more likely subsequent purchasers are to feel they have plenty of time to make up their minds.

The feeling that time is on their side gives purchasers the psychological edge. Basically they feel they can afford to offer less with more chance of getting a bargain.

In the final analysis, selling for the highest price usually means getting serious about that early offer. Sellers who turn down early offers often regret their refusal to negotiate when they discover that further down the track they end up settling for a lot less.

Whenever we get a situation where there are two or three people vying at the same time, our negotiating position is dramatically strengthened. We treat buyers with honesty to ensure they are comfortable negotiating against one another. All the offers are conducted in privacy, not publicly like an Auction so buyers don’t know what the other offers are. As a result we are able to negotiate an even better price.

E-Newsletter Register