Signing a contract of sale is one of the most significant financial decisions you will ever make. Understanding what you are signing before you commit is essential. Here is what to look for in a standard Australian contract of sale.
What Is a Contract of Sale?
A contract of sale is a legally binding document between a buyer and a seller that sets out the terms and conditions of the property transaction. Once signed by both parties and exchanged, it is generally binding — which is why you need to understand it before you sign.
Key Components of a Contract of Sale
- Parties: Buyer and seller names and legal entities. Check spelling and legal names carefully.
- Property details: Title reference, lot and plan number, address. Confirm against the certificate of title.
- Purchase price: The agreed sale price and deposit amount (typically 10%).
- Settlement date: The agreed settlement date — typically 30–90 days from exchange.
- Special conditions: Any additional conditions negotiated by buyer or seller — subject to finance, subject to building inspection, subject to sale of another property.
- Inclusions and exclusions: What is and is not included in the sale — appliances, blinds, garden sheds, light fittings.
- Vendor Statement (Section 32 in VIC): A statutory disclosure document the vendor must provide, including title details, outgoings, planning overlays, building permits and zoning.
Key Clauses to Watch For
| Clause | What It Means | What to Check |
|---|---|---|
| Subject to finance | Purchase conditional on loan approval | Finance amount, lender, deadline — usually 14–21 days |
| Subject to building inspection | Purchase conditional on satisfactory inspection | Inspection deadline, what constitutes a satisfactory result |
| Cooling off period | Right to withdraw within a set period | VIC: 3 business days. NSW: 5 business days. Does not apply at auction. |
| Deposit amount | Amount payable on exchange | Typically 10% — confirm if a reduced deposit has been negotiated |
| Settlement date | When the property legally changes hands | Ensure this aligns with your finance approval timeline and moving plans |
Red Flags in a Contract of Sale
- Unusual special conditions that limit your rights as a buyer
- Short settlement periods that may not allow enough time for finance approval
- Exclusions of items you assumed were included (dishwasher, curtains, etc.)
- Planning overlays or heritage controls you were not aware of
- Encumbrances, easements or covenants that restrict how you can use the property
Do I Need a Conveyancer or Solicitor?
Yes — always engage a conveyancer or solicitor to review the contract of sale before you sign. A Collings Property Advisor works alongside your conveyancer to give you an independent assessment of the commercial terms and negotiation strategy.
How Collings Property Advisory Can Help
A Collings Property Advisor reviews the contract of sale as part of our buyer advisory service, flags any red flags and advises on negotiating better terms — all included in our fixed fee of $4,500 + GST.
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