Brief Overview of a Standard REIQ Contract

In entering into a Standard REIQ Contract for Houses and Residential Land (9th edition) be aware of the following:

Cooling off period: A cooling off period in a Standard REIQ Contract is usually 5 business days, during which time you can change your mind about purchasing the property and (with the giving of proper notice) withdraw from the contract. Strict time limits apply. If you elect to terminate the contract under the cooling off period there is a termination penalty fee equal to 0.25% of the purchase price.

Full name: Ensure your full and correct name is shown. The name as shown on your birth certificate (or driver’s license) is to be used. Do not use abbreviations or nick-names. If your name for example is Anthony Alexander Smith, do not use Tony Alex Smith.

Reference Schedule

(Make sure all details are completed)

Fixtures: If any fixtures are to be excluded from the sale they should be specified in the relevant section of the Reference Schedule.

Chattels: Similarly, chattels which are included in the sale need to be listed.

Tenancies: If the property is sold subject to a tenancy ensure that all relevant details are completed in the Reference Schedule. If left blank, the buyer is entitled to vacant possession on the day of settlement.

Finance: If you are buying the property subject to obtaining finance, ensure that all three components of the finance clause are completed. For the clause to be legally valid and enforceable you need to state an actual amount, the name of a financier and a date or period for obtaining finance.

Building and Pest Inspection: If the property is sold subject to a building and pest inspection, ensure that the relevant section is completed in the Reference Schedule and is carried out by a registered/licensed inspector.

Pool Safety: If there is a pool on the property ensure that a Compliance or Exemption Certificate is provided.

Safety Switch and Smoke Alarm: Ensure that this section is completed.

Neighbour Disputes: If there are any disputes with neighbours concerning dividing fences and trees it should be stated in the relevant section of the Reference Schedule.

Special conditions: If there are to be any conditions over and above the “standard” conditions they should be set out in this section. For example, if the contract is subject to the sale of your existing home, then such condition would be inserted in this space.

Terms of Contract

Clause 3: Deals with finance and what you need to in order to comply.

Clause 4: Covers your rights to obtain Building and Pest Inspection Reports and Pool Safety.

Clause 6.1: Time is of the essence. This is very important as strict time limits apply. If you don’t comply by the date stated in the contract, you may be in breach of the contract and/or lose your rights under the contract. You may even forfeit your deposit.

Clause 8.1: The property is at the buyers risk from 5:00pm on the first Business Day after the Contract Date. Buyers should ensure they take out a cover note for insurance immediately upon signing the contract.

Clause 8.2: A buyer and or his/her authorised agent is entitled to access the property on several occasions for the purposes stated in this clause.

Clause 8.3: This sets out the seller’s obligations from the time the contract is signed until the settlement date.

Clause 10.3: The buyer must pay all duty on the contract.

N.B. please note that when you buy at auction, generally the contract is unconditional and building and pest and finance clauses do not apply.

Disclaimer
Please note the above is a general, brief overview of some of the provisions and clauses of the Standard REIQ Contract but certainly is not meant to be an exhaustive or detailed explanation of a seller or buyer’s rights or obligations. It is of a general nature only and you should take steps to obtain your own legal advice on your specific circumstances and not rely on the above.