Is that contract hiding unapproved work? Or worse? Trust your lawyer and dodge dangers

Every seller must have a contract of sale ready for viewing before advertising their residential property in the ACT.

The bulk of this contract covers pest inspections and building and compliance reports, but other inclusions, such as minutes from body corporate meetings, will depend on the property itself.

In short, they’re detailed. And usually quite lengthy.

So, when it comes to poring over contracts, you may need a good lawyer. An untrained eye could miss something important impacting the value of your property and what you can and can’t do with it.

Principal lawyer Andrew Satsias heads local firm Velocity Conveyancing, focusing on property law.

“A skilled lawyer knows exactly where to look for hidden unapproved structures, easements or restrictions that can impact property value, insurance and even determine where you can build,” Mr Satsias says.

“They should ideally practise in and know the area well. A local solicitor knows the ins and outs of particular developments or suburbs, which means they can spot any recurring issues.”

When to meet with a lawyer depends on the property and how it’s being sold. Whether it is a standard negotiation, an auction, or if you plan on making a pre-auction offer, the type of purchase will affect the process.

“For a standard sale, where they have an asking price or are open to offers, a lawyer does not need to review a contract until you’ve negotiated a price with the agent. Once the seller has accepted an offer, the agent will ask for your lawyer’s details and send us the completed contract. This is when we will organise a time for you to come in.

“It’s very important to go through the contract carefully with your lawyer to make sure you understand every aspect of the process.”

This is also the time to organise unconditional approval of finance, which is needed before you sign and commit to exchange.

If you’re attending an auction, things become a little more risky. If you make a successful bid, you’re bound to buy the property once the hammer falls.

“You must absolutely go through the contract of sale with a lawyer before you attend an auction,” Mr Satsias says.

“If you’re successful at auction, there’s no cooling-off period to change your mind. Backing out means the full 10 per cent deposit is at risk.”

Velocity Conveyancing advises regularly on pre-auction offers, something Mr Satsias says can go one way or another.

“When an auction listing goes out, some people are keen to negotiate before they attend,” he says.

“Legislation allows a five-day cooling-off period to get legal advice and decide whether to proceed with a property purchase.

“If a seller accepts a pre-auction offer, you’ll need to move quickly because they will usually ask you to waive your right to cooling off.”

Waiving this right is performed through a Section 17 certificate, signed by a lawyer. The certificate confirms your understanding that the cooling-off period will be waived and the contract of sale fully binding as soon as contracts are exchanged.

It all sounds a bit ominous, but Mr Satsias says not to let anxiety drive you away from the right home.

“People are often quite fearful to make an offer on a property when their finance details aren’t ready to go,” he says.

”There’s a concern that if the offer is accepted, they’re locked in. But in the ACT, unless a contract is signed and a deposit paid enabling an exchange, you’re not bound to buy a negotiated purchase, so feel free to negotiate a price, but don’t forget that it works both ways – the owner isn’t obliged to sell you the property until a contract of sale is signed either.”

Velocity Conveyancing has been specialising in residential conveyancing and property law since 1968 and has offices across the ACT.

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