Buying Off-The Plans Contract Changes - Hunter
March 04, 2020
The NSW Government has introduced changes affecting off-the-plan purchases. These changes to off-the-plan contract laws came into effect from 1 December 2019.
Summary of the main changes:
The vendor must now attach a disclosure statement to the contract before the contract is made. It must include a copy of a draft plan that contains the proposed lot number, its size and any easements or covenants affecting the lot. If the lot is in a strata development it must include draft by-laws.
The cooling off period is being extended to 10 business days for off-the-plan, however five is being retained for other types of property sales.
Vendors must serve a notice of any changes on the purchaser at least 21 days before completion of the contract if the vendor becomes aware that the disclosure statement contains inaccuracies in a “material particular”.
A material particular includes any change to the draft plan or draft by-laws that will, or is likely to, adversely affect the use or enjoyment of the property.
Purchasers will have the right to rescind if any change being made is to such an extent that the purchaser would not have entered into the contract in the first place. The change must be such that they will be “materially prejudiced” by the change.
Purchasers will have the same right if the disclosure statement that was attached to the contract includes inaccuracies which are significant enough that they would not have entered into the contract in the first place. The inaccuracy must be significant enough to materially prejudice the purchaser.
Currently, a vendor has to apply to the Supreme Court for permission to rescind a contract under a sunset clause if the lot has not been created by the date set out in the contract. This is being extended to other sunset provisions including clauses that allow for the contract to be rescinded if the occupation certificate for the subject lot is not issued by a certain date
For more information about the full overall of the changes click here or contact a HIA Workplace Advisor on 1300 650 620.