The Complete Guide to Reading an Australian Property Contract

Buying property is likely the biggest financial commitment you will ever make. Yet many Australian buyers sign contracts worth hundreds of thousands — sometimes millions — of dollars without fully understanding what they are agreeing to. A standard contract of sale might run 30 to 60 pages, filled with legal jargon and fine print that can hide costly obligations.

This guide walks you through every section of an Australian property contract so you can read it with confidence and know exactly what to look for before you sign.

What Is a Contract of Sale?

A contract of sale (sometimes called a "contract for the sale of land") is the legally binding agreement between the vendor (seller) and the purchaser (buyer). Once both parties sign and the cooling-off period expires, both sides are legally obligated to complete the transaction.

In Australia, each state and territory has its own legislation governing property sales. In New South Wales, contracts are governed by the Conveyancing Act 1919 (NSW) and the Conveyancing (Sale of Land) Regulation 2022. In Victoria, the Sale of Land Act 1962 (VIC) applies. Queensland relies on the Property Law Act 1974 (QLD). While the core principles are similar, specific requirements vary between jurisdictions.

The Key Sections of a Property Contract

1. The Particulars of Sale

This front page contains the essential details of the transaction:

• Vendor and purchaser names — Check these match the intended parties exactly. Errors here can delay settlement.
• Property address and title reference — The legal description including Lot and Deposited Plan (DP) numbers.
• Purchase price — The agreed sale amount.
• Deposit amount and payment terms — Usually 10% of the purchase price, paid on exchange.
• Settlement date or period — Typically 42 days (6 weeks) in NSW, 30-90 days in VIC, 30 days in QLD.
• Inclusions and exclusions — Items like curtains, light fittings, dishwashers. If it is not listed, do not assume it stays.

2. The Title Search (Section 149 Certificate in NSW)

The title search reveals critical information about the property:

• Easements — Rights granted to third parties (like council drainage or electricity lines) that may restrict what you can build.
• Covenants — Restrictions on land use, such as limitations on building materials or fence heights.
• Caveats — Claims or interests registered against the property by third parties.
• Mortgages — Any existing loans secured against the property (these should be discharged at settlement).

3. Special Conditions

Common special conditions include:

• Subject to finance — Makes the contract conditional on the buyer securing a home loan by a specified date. See our guide on what a finance clause is and how it protects you.
• Subject to building and pest inspection — Allows the buyer to terminate if inspections reveal significant defects.
• Sunset clauses — Common in off-the-plan purchases, these set a deadline by which the development must be completed. If the developer misses it, the contract can be rescinded — but recent reforms in NSW and VIC now require vendor consent or court orders to invoke sunset clauses. Learn more in our sunset clause explainer.
• Early access or pre-settlement occupation — Clauses allowing the buyer to access the property before settlement, which can create insurance and liability issues.

4. Vendor's Disclosure (Section 32 in Victoria)

In Victoria, the vendor must provide a Section 32 Statement (Vendor's Statement) before the contract is signed. This disclosure includes title details, planning information, owner-builder warranties, and outgoings. In NSW, equivalent disclosures are attached to the contract itself. In Queensland, the seller provides a disclosure statement under the Property Law Act 1974. For a deeper look at what vendors are legally required to tell you, read our article on vendor disclosure obligations in Australia.

Always verify:

• That all required disclosures are present and complete
• Zoning information matches your intended use
• Any outstanding orders or notices from the council
• Body corporate (strata) records for units and apartments

5. Strata Records (for Units and Apartments)

If you are buying a strata-titled property, the contract should include or reference strata records containing:

• Strata plan — The registered plan showing lot boundaries
• By-laws — Rules governing the building (pets, renovations, noise)
• Minutes of meetings — Reveals planned works, disputes, and financial health
• Sinking fund and admin fund balances — Low reserves may signal upcoming special levies
• Any special levy notices — These can add thousands to your costs unexpectedly

Common Contract Traps to Watch For

Vague Completion Dates

Off-the-plan contracts sometimes use phrases like "estimated completion" rather than a fixed date. Without a firm sunset clause with clear remedies, you could be waiting years with your deposit locked away.

Unreasonable Penalty Interest

If settlement is delayed, the defaulting party may owe penalty interest. Check the rate — some contracts specify rates well above the standard 10% per annum. Negotiate this before signing.

Defect Liability Gaps

For new builds, ensure the contract references the statutory warranty periods under the relevant Home Building Act. In NSW, structural defects are covered for 6 years and non-structural for 2 years under the Home Building Act 1989.

GST Clauses

Some contracts include a "GST inclusive" or "plus GST" clause. For residential property purchases, GST generally does not apply to existing dwellings but does apply to new residential premises or vacant land sold by developers. Confirm the GST treatment before signing.

State-by-State Differences

• NSW: Standard contract prescribed by the Law Society and Real Estate Institute. Cooling-off period of 5 business days. 0.25% penalty if buyer exercises cooling-off.
• VIC: Section 32 vendor statement required before signing. Cooling-off period of 3 business days. Cooling-off does not apply at auction.
• QLD: Contracts use the REIQ standard form. Cooling-off period of 5 business days. Buyer can terminate with 0.25% penalty.
• WA: Joint Form of General Conditions applies. No statutory cooling-off for private sales (only for some off-the-plan). Finance clause typically 14-21 days.
• SA: Cooling-off period of 2 clear business days for residential property. Form 1 vendor disclosure required.
• TAS: Cooling-off period of various lengths depending on the sale method. Property Agents and Land Transactions Act 2016 governs.
• ACT: 5 business days cooling-off period. Contract must include pest and building reports or buyer has right to terminate.
• NT: 4 business days cooling-off period under the Law of Property Act 2000.

What to Do Before Signing

Related Guides

• Red Flags in Property Contracts — Learn what warning signs to watch for
• Section 32 Vendor Statement Explained — Essential reading for Victorian buyers
• Special Conditions in Property Contracts — What they mean and how they affect you
• Property Due Diligence Checklist — Everything to check before buying