General obligations and conditions
you have to comply with
The sale and purchase agreement includes
general obligations and conditions that you
will need to comply with. For example, these
may include:
• access rights – what access the buyer
can have to inspect the property before
settlement
• insurance – to make sure the property
remains insured until the settlement date
and outline what will happen if any
damage occurs
• default by the buyer – the buyer may have to
compensate the seller if they don’t settle on
time, for example, with interest payments
The agent helps the buyer
and the seller to include the
conditions they each want.
Even though the agent works
for the seller, they also have
to deal fairly and honestly
with the buyer. They can’t
withhold any information,
and they must tell the buyer
about any known defects
with the property.
• default by the seller – the seller may have
to compensate the buyer if they don’t
settle on time, for example, by paying
accommodation costs.
Your lawyer will explain these clauses to you.
Specific conditions a buyer
may include
Some buyers will present an unconditional
offer, which means there are no specific
conditions to be fulfilled. Some buyers will
include one or more conditions (that must
be fulfilled by a specified date) in their offer
such as:
• title search – this is done by the buyer’s
lawyer to check who the legal owner of the
property is and to see if there are any other
interests over the property such as caveats
or easements
• finance – this refers to the buyer arranging
payment, often requiring a mortgage
or loan
• valuation report – a bank may require the
buyer to obtain a valuation of the property
(an estimate of the property’s worth on the
current market) before they agree to a loan
• Land Information Memorandum (LIM) –
provided by the local council, this report
provides information about the property
such as rates, building permits and
consents, drainage, planning and other
important information
• builder’s report – to determine the condition
of the building
• engineer’s or surveyor’s report – similar to
the above but more focused on the entire
section and the structure of the property
• sale of another home – the buyer may
need to sell their own home in order
to buy another.