Queensland Conveyancing FAQs

So you’ve found the perfect home, you’ve signed the Contract and now you’re navigating the legal minefield. Buying your first home can be a daunting and exciting experience, and along the way many questions pop up about the Standard Terms and Conditions of the Contract.

Here, we answer some of the most frequently asked questions during the conveyancing process.

Am I eligible for the first home owners grant (FHOG)?

Our Associate, Renee Lovelady Tomas, recently published a blog (The first home vacant land concession – can you claim it and what happens after you claim it?) about when a purchaser can claim the first home owners grant (FHOG). You will only be eligible for the FHOG if you are purchasing vacant land to construct your first home.

If you are purchasing an existing property as your first home, you can claim a first home concession if:

• You buy a property valued under $550,000
• You are at least 18 years of age
• You have never held an interest in residential land anywhere in the world
• You haven’t received a first home vacant land concession before

After you claim the concession you must:

• move into the property with your personal belonging and live there on a daily basis within 1 year of settlement
• not dispose (sell, transfer, lease or otherwise grant exclusive possession) or all or part of the property before you move in.

If you claim the concession but don’t meet its eligibility requirements, you must notify the Office of State Revenue and you may be liable to pay the transfer duty liability at the investment rate plus any unpaid tax interest and penalty tax depending on your circumstances.

Why do I have to take out insurance on the property before settlement?

One of the first things we will tell you after the contract is signed is to make sure you have insurance on the property. In accordance with the Standard Terms of the Contract, “the property is at the Buyer’s risk from 5.00pm on the first Business Day after the Contract Date”.  Not having insurance is very risky! If for example, the property was damaged due to a natural disaster or a fire after the Contract is signed, you could be liable for the damage and be forced to complete the Contract.

Although the Seller will usually keep their insurance policy in place until settlement is completed, taking out insurance on the property will provide you with added protection to reserve your rights when making an insurance claim. If you are obtaining finance from a bank, it may be one of the bank’s requirements to take out insurance on the property as they will have as much as an interest in the property as you do.

Who pays the rates?

At settlement, the purchase price will be adjusted in accordance with the Standard Terms of the Contract. This adjustment will be for the ‘Outgoings’ of the property which are usually council rates and water. The Seller is liable for the Outgoings up to an including the settlement date, and the Buyer will be liable thereafter.

Once settlement is completed, the Local Council will be notified of the change in ownership. A fee will usually apply for the Local Council to amend the property record.

What does ‘going unconditional’ mean?

Often a Contract will be subject to a number of Standard Terms and Conditions. Once a contract is signed, you will be afforded a 5 day cooling off period, this means that if you ‘change your mind’ during this period you can elect to terminate the contract. But (and there’s always a but), the seller can choose to apply a termination penalty which is 0.25% of the purchase price.

The Contract is also usually subject to finance approval and satisfactory building inspection and pest reports. When the conditions are due, you are required to provide written notification to the Seller advising whether you have obtained finance approval and satisfactory finance approval and building and pest inspection reports. If you have, that’s great! Once all of the Contract conditions are satisfied, the Contract will be deemed ‘unconditional’ and settlement will be completed in accordance with the Contract.

If you have not been able to obtain finance from the bank or you have not received satisfactory building inspection and pest reports, you should contact your solicitor as soon as possible to discuss your options and whether you have any grounds to terminate the Contract.

Do I have to attend settlement myself?

We will attend settlement on your behalf and do all of the hard work for you! On the day of settlement, all you have to do is sit back, relax and wait for us to notify you once everything has been finalised. Then you can collect your keys for your new home and pop the champagne!