Selling a Property in NSW: What you need to know

Selling your house is a big decision to make, especially if it’s your first time. You must consider several factors, including the current property landscape, buyer attitude and interest environment before finalising your decision. Moreover, preparing the details and requirements you need to meet your legal obligations as a seller can be quite overwhelming.

The real estate transaction process can be quite complex because there are different laws and regulations for each state. Hence, understanding the property selling process for your state can help you prepare the requirements for the sale. To help you get started, here is what you need to do before selling a property in NSW.

Selling a Property in NSW:

1. Prepare the contract of sale

Before you can start selling a property in NSW, you must first prepare the contract of sale. You should complete the contract prior to marketing or advertising the property for sale. The contract will be provided to potential buyers and should include prescribed documents required to be attached by law and the regulations to the Conttact:

The terms and conditions of your sale.
Title and plan documents confirming that you own the property.
Zoning Certificate (section 10.7) issued by the local council, which shows planning controls and other factors that may affect the property, e.g., proposed road widening.
Compliance certificates.
Relevant documents for strata title if the property is under a community scheme.
Drainage diagrams to show the location of any sewer lines.
Copies of any documents creating easements, rights of way, restrictions or covenants.
Certificate showing whether land tax is owing on the property.

Moreover, excluding strata properties, if your property for sale has a pool, there are additional requirements that you must prepare. Failure to attach at least one of the following may give cause for the buyer to rescind the contract:

copy of a valid certificate of compliance, or
valid occupation certificate (issued in the past 3 years) and evidence that the pool has been registered, or
valid certificate of non-compliance.

When preparing your contract, make sure to also include warranties or certain promises about the property for sale. You can also include property exclusions or items not included in the sale, and a statement of the buyer’s cooling-off rights.

Putting your property up for sale without a proper contract is considered an offence in NSW, which could lead to fines or penalties. Moreover, if your contract is not compliant with Vendor Disclosure Requirements, then the buyer may rescind the contract.

2. Determine the value of your property

If you are selling your property through a Private Treaty sale, then you can set the price for it yourself. However, you must first have your property valued, so you can determine the value of your property in the current market. Thus, allowing you to price your property properly.

The NSW Valuer General offers a convenient online tool to help you find out the current value of your property for sale. All you need is:

the valuing year
your property number, which can be found:
- on your notice of valuation (which provides only the land value of the property without any improvements thereon)
- on your land tax assessment (from Revenue NSW)
- via a property address enquiry
- via a title reference enquiry.

You can also conduct a search of similar properties that are up for sale online to compare prices. If you require a more in-depth comparative market analysis, you can also contact a local real estate agent for help.

However, if you decide to sell your property through auction, there is a different process that you must undergo. For example, the price that you have set will not be revealed to potential buyers who will be bidding on your property.

You will also be nominating a reserve price or the lowest amount you are willing to accept for your property. If the highest bid is below the reserve price, the property will be passed in. When this happens, you can try to negotiate a reasonable price with the interested bidders. However, if you are not satisfied with the negotiation, you may put the property back on the market.

Moreover, there won’t be a cooling-off period for the winning bidder, who will be paying you a deposit on the spot. If there are no issues with your property, you can also exchange contracts on the same day. Hence, you must carefully consider how you want to sell your property to guarantee a successful sale.

3. Advertise the property for sale

Once you have set the right price for your property, you can start advertising it. Whether you advertise through popular real estate selling websites or through the local paper is up to you.

In NSW, there are several newspapers with a dedicated property section where you can advertise your property. You can also subscribe to online listings to have your property advertised on websites dedicated to selling real estate. Also, you can do your own marketing campaign on your personal social media accounts.

Moreover, if you choose to work with a real estate agent, they will advertise your property for you. However, make sure to work with a licenced real estate agent in NSW with sufficient experience in property transactions.

4. Exchange Sale Contracts

Once you have a confirmed buyer for your property, you can now exchange the contract of sale. You must have two copies of your contract–one for you and one for the buyer. Both you and the buyer must sign your own copies and swap or exchange them.

Exchanging the contract of sale is the legal part of selling a property in NSW. The contract will not be binding unless it is signed, dated and exchanged, which is why this is a critical part of the selling process.

After you and the buyer have exchanged your signed copies of the contract, the buyer is required to pay the deposit. Then, if it has not been waived beforehand, the cooling-off period begins.

The cooling-off period gives the buyer five (5) business days after you exchanged contracts to re-think the offer. During this time, the buyer can also do the final inspections of the property.

If the buyer decides to back out from the transaction during the cooling-off period, they will not receive any legal penalties. However, they will have to pay a termination fee to cancel the contract—0.25% of the purchase price.

5. Settle the property sale

If the buyer is satisfied with the details of the property, you can proceed with the settlement. The settlement takes place normally 42 days after you have exchanged the contract. During settlement, the buyer will pay the outstanding of the purchase price together with any pro rata adjustments for statutory outgoings and become the new legal owner of the property.

In NSW, all property transactions are settled and lodged online through Electronic Lodgement Network Operators (ELNOs). Hence, you must engage a property lawyer or licensed conveyancer who is subscribed to an ELNO to complete the settlement.

To complete the property transaction, you must provide your lawyer or conveyancer with a written Client Authorisation. You must also provide photo identification documents and evidence of your land ownership. This is so your lawyer or conveyancer can verify your identity and establish the right to deal on your behalf.

Through the ELNO, the settlement will occur automatically. This includes the payment disbursement and electronic lodgement of new ownership to the NSW Land Registry. Once completed, your lawyer or conveyancer will let you know that the property has been successfully transferred.

Conclusion

VC Lawyers is a pioneer of electronic conveyancing and has completed quite a number of property settlements. We are a team of well-experienced solicitors and paralegals who can help you on your property transaction journey. More importantly, we can reduce the difficulty, stress and anxiety of settlement, especially for first-time home sellers.

Talk to us to find out how we can serve your interests better and provide you with the most beneficial legal outcome for your property transactions.

NB: This blog post is neither a legal advice nor intended to be such, and is only for general information. The same should not also be taken as a financial or commercial advice. The reader must personally consult their professional adviser/s on the contents of this blog post. VC Lawyers is not liable for any loss or damage, direct or consequential, as a result of the reader’s or a third person’s misconstruction of the wordings or use/misuse of the contents of this blog post.

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Selling a Property in NSW: What you need to know