Major Conveyancing Shake Up Arrived on January 20, 2023

The REIQ and Queensland Law Society have introduced a new sale contract. This is the 17th edition. They have also amended the contract for Residential Lots in a Community Titles Scheme, it is now the 13th edition.

The stated reasons for the amendments are new case law; new and updated legislation; to clarify some aspects of the contract and to address settlement delays being caused by banks and other matters.

Some of these changes e.g extending settlement times are in their totality very significant compared to the way real estate transactions have taken place for the last 40 or more years.

Other aspects being changed are determining when deposits have been paid by Direct Debit – new clause2.2 (3)-(5).Pool Compliance Certificates, Contract Date and calculation of Time. We will be covering these aspects in later blogs and newsletters.

Both the REIQ and the Law Society seem to have decided to "grasp the nettle" and offer real world solutions to legislation linked problems and other difficulties which are probably really associated with Covid 19 and working from home. If you are working in the real estate business it is hard to accept that productivity in bank mortgage lending practices is as good as it was pre-covid 19.

There have been cases recently were deposits of been lost to Sellers because banks did not perform by the due dates and under the “Time is of the Essence” regime there was no protection for the Buyers.

What has been done is not a perfect solution it will cause a lot of pain particularly if the use of Settlement Extensions becomes widespread. We have already had a situation where a client had entered into a Version 16 Agreement with no time extensions to purchase a property and was selling in order to finance the purchase on a Version 17 contract where, if there had been any extension by the other side on the second contract which was financing the purchase, our client would be breach under the first contract with no remedy.

These situations will crop up for a while, hopefully when all of the transactions are taking place on the Version 17 Contract there will be fewer problems

You can find out more about Extensions and Smoke Alarms in other articles in this month's newsletter.

 

by David Hamilton 

Director, First National Palm Beach | 0419 763 924

palmbeachfn.com.au February 2021
First National Palm Beach
Ph: 07 5559 9600