Conveyancing is the term used to describe the transfer of ownership in property from a Seller to a Buyer. Property Conveyancing can be complicated as every property is different and there are many things which may potentially go wrong.
As part of the Property Conveyancing process, your Lawyer/Conveyancer should discuss the property with you, prior to entering in to a Contract and seek to identify as many potential issues that may be associated with the property that should be considered. Often, problems are identified after a contract is signed which is why the term “Buyer Beware” is important to understand.
This is better understood in contrast to the purchase of a household product like a refrigerator. Under Australian Consumer Law, retail customers are protected from potential problems that may occur in purchasing a product as they are entitled to repair or replacement, and a refund and if the product does not meet the product guarantee. The Australian Consumer Law does not apply to the purchase of property, hence the term “Buyer Beware”.
When you enter in to a Contract to purchase a property in Queensland you may be inheriting any problems/issues that relate to the property. Buyers need to be aware of what they are agreeing to as the Sellers may not disclose any/all defects pertaining to the property. Unless you have a condition in your Contract ie Due Diligence, you may not have a right to terminate and be required to settle the property despite any issues being revealed. As a Buyer, you may have a right to sue for damages for misleading or deceptive misrepresentations made against the property which you relied upon when you entered in to the Contract. However, this process can be costly, complex, stressful and often take considerable amounts of time that may not have a favourable outcome.
The onus is on the Buyer to undertake searches and expert reports to satisfy themselves that there are no issues with the property. Searches help you establish if the property is affected by environmental restrictions, easements, known or future planned development or traffic plans, licenses issued by Government or Heritage listings. Searches also provide information about possible encumbrances on the title. Easements can influence how the property can be used, identify areas that are available for service providers to access, shared access to neighbouring properties and more.
Buyers should carefully consider the number of searches they undertake as part of the conveyancing process. No matter what you are told, there is no real formula for establishing how many searches is enough as every property is different. The experience of your Lawyer/Conveyancer is pertinent in providing you advice and discussing the value of individual searches to your specific property. Ultimately, you need to be confident that you are making an informed decision.
Pest and Building Inspections undertaken by independent professionals is another method that Buyers can adopt to better understand any issues that may exist with the property you are purchasing.
Often, property Buyers and Sellers place significant importance on getting the lowest price on conveyancing and searches without fully understanding the risks associated with their decision. When you consider the price of your property, it is evident that any potential problems that you inherit as part of your purchase could cost thousands of dollars. Trying to save a few hundred dollars in conveyancing or searches and compromising the experience and professionalism of your Lawyer/Conveyancer may not be very cost effective in the end.
Like any important, significant financial transaction, your priority should be ensuring that you engage a qualified, experienced, well informed Lawyer/Conveyancer to represent you. Your Lawyer/Conveyancer should be experienced and effective in communicating and explaining your rights and options in protecting your financial investment.
Some key tips to consider prior to signing a Contract:
1. How do you sell your property?
There are three (3) key ways to sell a house, by auction, by Sales Agent or privately. It is important for you to be guided by industry professionals as to the best method to sell your property. Factors to consider include, the location of your property, the type of house i.e. unit/townhouse/land etc. and the current state of the property market.
Consider the properties location, size, age and features as well as the current area trends. It may be an idea to engage an industry professional to assist with providing you with a realistic price guide.
2. Before you sign a contract
It is strongly recommended that your Lawyer/Conveyancer reviews the Contract before you enter in to same.
From a Buyer’s perspective – ensuring all your key terms are included eg finance, pest and building and due diligence conditions. It is vital that your full names are disclosed on the Contract and are spelt correctly prior to signing a contract to ensure that your matter proceeds without potentially risking your contract.
It is also advisable to contact your bank and obtain pre-approval for a loan amount which is realistic and affordable.
From a Seller’s perspective – it is important to ensure that your Lawyer/Conveyancer reviews the contract and advises you of any possible issues or risks with the terms of your Contract. It is also important that you are aware of your disclosure obligations to ensure that your Buyer enters into a binding and enforceable Contract of Sale.
3. The Role of the Lawyer/Conveyancer and Real Estate Agent
It is important to understand the different roles your Lawyer/Conveyancer and Real Estate Agent have in the conveyancing process. It is also important to understand how their expertise, reputation and professionalism can influence the outcome of one of the largest financial transactions you are likely to undertake in your life.
Real Estate Agent – whether you are buying or selling a property it is important to engage the right agent for your property. Engaging the right Agent may influence the price of the property and the amount of time a property will take to sell. Local property agents tend to have a better understanding of their local market than others. Both the experience and reputation of the real estate company and the individual sales person are equally important. Research both well and where possible, seek the advice of others you may know who have sold in your local area.
Your Lawyer/Conveyancer’s experience and attention to detail can significantly influence the financial risk associated with your financial investment. When selecting your Lawyer/Conveyancer, you need to consider the level of risk you are prepared to take in purchasing or selling your property. This should take priority rather than obtaining the lowest quote for legal costs and incurred outlays. A good Lawyer/Conveyancer will explain everything to you in plain English and be available when needed to deal with any problems or issues that may arise.
Property conveyance is a key component of A.L.F. Lawyers and we offer our clients a fixed fee. Call for a quote to act on your behalf on (07) 3088 6161 or by email on firstname.lastname@example.org.