Lot 5 of 6 · The paperwork
Contracts and conveyancing
In NSW a home cannot be put on the market until a contract of sale, prepared by a lawyer or licensed conveyancer, has been drawn up and made available. Conveyancing is the legal work around that contract, and while buyers can do their own, most engage a licensed conveyancer or a solicitor.
What comes attached to the contract
Section 52A of the Conveyancing Act 1919 requires certain documents to be attached to the contract, and Schedule 1 of the Conveyancing (Sale of Land) Regulation 2022 lists them all. NSW Fair Trading names these among them.
- The title search, known as a property certificate.
- Diagrams of the drainage.
- The local council’s planning certificate.
- Any dealing on the lot that concerns an easement, a profit à prendre, a positive covenant or a restriction on how the land is used.
- A notice about smoke alarms and loose-fill asbestos insulation, unless it is printed in the contract.
- For a property with a swimming or spa pool: a valid certificate of compliance, an occupation certificate with evidence the pool is registered, or a valid certificate of non-compliance (with exceptions for strata or community schemes of more than two lots, and off-the-plan contracts).
- For a strata lot: the strata plan and the scheme’s by-laws.
More generally, the national Asbestos and Silica Safety and Eradication Agency says it is “not recommended that you handle or remove asbestos yourself”, and in NSW the state government says a home owner may legally take out less than 10 square metres of non-friable material themselves, but must meet strict safety standards and protect others from harm, while any friable material, or more than 10 square metres, must be removed by a licensed removalist. The national agency adds that a professional is the easier, safer and often cheaper choice. It also says householders have legal duties, under public health laws and common law, to protect other people’s health as well as their own and their family’s, which means taking every necessary precaution to prevent or minimise exposure to the fibres. Any tradesperson, handyman or contractor you hire for repairs, maintenance or other work on the home must obey work health and safety laws and follow strict safety procedures. Without a removal licence they may remove only less than 10 square metres of the non-friable kind, and only if they are trained to identify it, handle it safely and apply control measures, use the proper tools and equipment, and follow safe methods for removal, decontamination and disposal. In the ACT, any removal needs a licensed removalist unless it is part of minor routine maintenance or other minor work. Of the two licence classes, Class A covers every type and Class B only the non-friable kind. Asbestos waste may only go to a landfill licensed to take it; putting it in a household rubbish bin can bring a fine. (Sources: the agency’s guidance for householders and home renovators; the NSW Government on unlicensed removal at home; WorkSafe ACT on minor work.)
The contract must also list any exclusions from the property and carry the prescribed statement about cooling-off. Off-the-plan contracts carry more again, including a disclosure statement, a draft plan and draft by-laws; Fair Trading’s page for agents says that if one of those documents is not attached before the contract is signed, the purchaser may rescind within 14 days of exchange.
The contract can be changed before signing, but only by a solicitor or licensed conveyancer. A real estate agent cannot change any part of it, and a buyer’s agent is a real estate agent acting for the buyer.
The conveyancer’s work, either side of exchange
Fair Trading describes conveyancing as the legal work of preparing a sales contract, mortgage and related documents, and lists the steps it can involve. Grouped around the day contracts are exchanged:
Before exchange
- Examine the contract of sale.
- Arrange building and pest inspections.
- Examine a strata inspection report, for a strata property.
- Arrange finance if needed.
- Check for outstanding arrears or land tax.
- Check whether swimming pool compliance documents are needed.
- Find out whether a government authority, such as the council, Sydney Water or Transport for NSW, has an interest in the land or a planned development could affect it.
- Look for anything not disclosed, such as a fence dispute or illegal building work.
Exchange to settlement
- Exchange the contract and pay the deposit.
- Arrange payment of stamp duty.
- Prepare and examine the mortgage.
- Work out adjustments for council and water rates.
- Oversee the change of title with NSW Land Registry Services.
- Make final checks, and attend settlement.
Fair Trading’s wording is that conveyancing “can involve” these steps; grouping them either side of exchange is this page’s own.
Settlement, now electronic
Settlement usually takes place around 6 weeks after exchange, when the rest of the price is paid and the buyer becomes the legal owner. In NSW it is done electronically, by a lawyer or licensed conveyancer who subscribes to an Electronic Lodgment Network. They verify their client’s identity and prepare the documents and financial details in an electronic workspace. Cheques and paper documents are no longer needed for settlements in NSW.
At the scheduled time, if everything is ready, settlement happens automatically: the money is paid out as authorised and the documents are lodged with NSW Land Registry Services. Fair Trading’s page also describes a final inspection of the property on the morning of settlement, to confirm it is in the condition it was in at exchange.
Who does the work
Fair Trading says conveyancers and solicitors are equally qualified to do conveyancing. In NSW conveyancers must be licensed with NSW Fair Trading, and both conveyancers and solicitors must hold professional indemnity insurance. A conveyancer’s licence can be checked on the same licence check used for property agents.
On cost, practitioners must disclose certain information, including their costs, generally before or when they are engaged, and Fair Trading suggests asking for an itemised statement of likely costs before work starts. Fees vary, and there are usually disbursements on top, such as a title search, certificate fees and registration of the mortgage and transfer.
Doing it alone is allowed, but Fair Trading cautions that a buyer who does their own conveyancing takes on all the responsibility for the sale progressing legally, and stays personally liable if something goes wrong. Complaints about a conveyancer go to NSW Fair Trading; complaints about a solicitor go to the NSW Legal Services Commissioner.