Dealing with a conveyancing transaction and issues relating to property law can be complex and involve significant financial risk.

Conveyancing

Conveyancing is the process of transferring the legal title of property from one party to another. A conveyancing transaction is often one of the largest financial transactions a person will make, yet the process typically moves very quickly providing little to no room for error.

Entering a written contract to buy or sell property creates binding legal obligations between the parties – the penalties for default or failure to comply with a contract of sale can be significant so it is important to understand the implications by getting legal advice before signing.

The transfer of property can also trigger other financial considerations (for buyers and vendors, as relevant) such as capital gains tax, goods and services tax, land tax and land transfer duty (otherwise known as stamp duty).

We will guide you through the process and explain things clearly and in plain English so that you understand every step. For further information see our section on Doing Conveyancing Properly

Purchasing a property ‘off the plan’

Buying ‘off the plan’ usually refers to purchasing property that has not yet been registered as a separate lot with the government department responsible for land title registrations, Land Victoria, or not currently built.

A contract for purchase of property off the plan will not have an exact completion or settlement date as construction of the building project is incomplete and the subsequent registration process for the title to the land or new building has yet to occur.

Off-the-plan contracts will generally include several clauses that are different to standard contracts for registered land. One of the main differences  is the timeframe for the owner of the building project to complete the subdivision or building on the land. Once a property becomes registered with Land Victoria, settlement of the contract is triggered which must take place within a specified timeframe, otherwise the purchaser may have to pay penalty interest. This short settlement period can raise issues for purchasers in respect to their finance arrangements.

To avoid any penalties, a purchaser buying property off the plan must ensure their finance provider is prepared to undertake settlement within the stipulated timeframe. It is also prudent to request that a longer settlement timeframe be included in the contract.

Off the plan contracts also often include a provision called a ‘sunset clause’ which provides a period within which the contract must be completed, if the stipulated date passes, the buyer can terminate the contract.

Retirement Villages

When someone decides to ‘purchase’ a home or property in a retirement village, they are essentially entering into an agreement with management of the retirement village, to give management a ‘loan’ of their money in exchange for the right to live and use the services offered in the retirement facility. Before entering into a binding retirement village contract, it is vital that you understand the terms and conditions in the agreement.

A strata title is one common form of contract offered by retirement villages that are profit driven. They entitle you to occupy the property and become a member of the owner’s corporation that requires an annual fee. You also become the registered owner on the title deed.

A leasehold is another common type of contract where you purchase the right to lease the property, usually for 99 years and ownership remains with the retirement village operator.

Before considering entering into a retirement village agreement, it is important to understand what happens;

• if you decide to move out of the retirement village at any point;

• to the money you have “loaned” to the retirement village upon your death;

• to the money you have loaned to the retirement village in the event that it goes out of business.

Subdivision

Subdivision is the act of dividing land into pieces which makes the land easier to develop or sell. Subdividing land can be a complex process as there are vast requirements that you need to consider before commencing the subdivision process. You should consider the following:

• Is there any state legislation or local planning policies that could impact on your proposal for subdivision?
• Can the proposed new lots of land be appropriately serviced by utilities and other infrastructure?
• Can the land being subdivided sustain the increased use or development following the subdivision?
• In what ways, if any, does the subdivision affect existing buildings?

You will need to lodge an application to Land Victoria under Section 22 of the Subdivision Act 1988 if you want to subdivide your property. You will also need to apply for a planning permit from the local council for any developments you intend to undertake during and after the subdivision.

Commercial leases

Leases often involve long term commitments and significant financial obligations. The relationship between a landlord and a tenant can last for years. It is important to seek legal advice from an experienced commercial and property lawyer before entering into a lease.

Commercial leases set out the legal terms and conditions through which a business may occupy premises to operate its trade or service. Many lease disputes can be avoided with the careful drafting of a written agreement that includes all negotiated terms and conditions and provides for various contingencies. Obtaining independent legal advice ensures the respective parties an opportunity to question or negotiate the terms of the agreement, to foster clarity and understanding of their respective rights and responsibilities.

Our conveyancing and property team is highly experienced, and we have specialist accreditation in property law.

We can assist with:

• Residential and commercial conveyancing transactions

• ‘Off the Plan’ sales and purchases
• Subdivision and developments
• Restrictive covenants and easements
• Section 173 agreements
• Adverse possession
• Owners Corporations
• Stamp duty and land tax
• Joint Venture Agreements and Property Development Agreements
• Leases and licensing
• Retirement Villages and Aged Care Agreements
• Property transfers and related party transfers
• Mortgages, loan agreements and caveats
• Documentation for loans within families
• Commercial, retail and industrial leasing

If you need assistance, contact one of our lawyers at [email protected] or call (03) 9432 3131 for expert legal advice.