Property Settlement Process in Australia: How Long Does It Take?
A complete guide to the property settlement process in Australia — typical timelines by state, what happens from exchange to settlement day, and what can go wrong.
Definition
Property Settlement
The final step in a property transaction where legal ownership transfers from the vendor to the buyer, the remaining purchase price is paid, and the buyer receives the keys. Also called 'completion.'
Property settlement in Australia typically takes 30 to 90 days from the date of exchange, depending on what is agreed in the contract. The most common settlement period is 6 weeks (42 days), though 30-day and 90-day settlements are also standard. This guide explains the entire settlement process from exchange of contracts through to receiving the keys, including what happens on settlement day and what can go wrong.
What Is Settlement?
Settlement (also called "completion") is the final step in a property transaction. It is the day when legal ownership of the property transfers from the vendor (seller) to the buyer. On settlement day:
- The buyer's lender pays the remaining purchase price to the vendor's solicitor or conveyancer
- The vendor hands over the title documents and keys
- Any existing mortgages on the property are discharged
- Stamp duty and transfer documents are lodged with the relevant state land titles office
- The buyer becomes the registered owner of the property
In practice, settlement is handled electronically in most states through platforms like PEXA (Property Exchange Australia), which means the parties do not physically meet. Your conveyancer and lender manage the entire process on your behalf.
Timeline: From Exchange to Settlement
Here is what happens between the exchange of contracts and settlement day, broken down into stages:
- 1
Exchange of Contracts (Day 0)
The buyer and vendor both sign the contract of sale. The buyer pays the deposit (typically 5-10% of the purchase price) which is held in a trust account until settlement. From this point, both parties are legally committed.
- 2
Cooling-Off Period (Days 1-5)
If applicable, the buyer's cooling-off period runs for the first few business days after exchange. This does not apply to auction purchases. If the buyer does not rescind during this period, the contract proceeds.
- 3
Finance Approval (Days 1-21)
If the contract is subject to finance, the buyer must obtain formal loan approval within the specified timeframe (usually 14-21 days). The lender completes a property valuation, assesses financial documents, and issues a formal letter of offer.
- 4
Conveyancing Searches and Checks (Weeks 1-4)
Your solicitor or conveyancer conducts title searches, council and water rate checks, planning and zoning certificates, strata/body corporate searches, drainage and sewer diagrams, and checks for outstanding orders.
- 5
Pre-Settlement Inspection (1-7 Days Before)
The buyer inspects the property to confirm it is in substantially the same condition as at exchange, all inclusions are present, no damage has occurred, and any agreed repairs have been completed.
- 6
Settlement Day
The transaction is completed, usually electronically via PEXA. Your lender transfers loan funds, the vendor's mortgage is discharged, the purchase price is paid, stamp duty is paid, the title transfer is lodged, and you receive the keys.
Pre-Settlement Inspection
If you discover issues during the pre-settlement inspection, notify your conveyancer immediately. They may be able to negotiate a price reduction, holdback of funds, or delay settlement until the issue is resolved.
On settlement day, the transaction is completed, usually electronically via PEXA or a similar platform. For a detailed walkthrough of exactly what to expect, see our guide on what happens on settlement day. Settlement typically occurs in the morning or early afternoon. Your conveyancer will notify you once settlement has been completed and arrange key collection (often from the real estate agent's office).
State-by-State Settlement Timelines
Settlement Timelines by State
| State | Typical Period | Electronic Settlement | Notes |
|---|---|---|---|
| NSW | 42 days (6 weeks) | PEXA (mandatory for most) | Can negotiate 30-90 days |
| VIC | 30-60 days | PEXA (mandatory) | 30 days increasingly common |
| QLD | 30-42 days | PEXA available | Shorter settlements common |
| WA | 30-42 days | PEXA (mandatory) | 28-day settlements not uncommon |
| SA | 30-42 days | PEXA available | Settlement can be at vendor's solicitor's office |
| TAS | 30-42 days | Paper-based and PEXA | Varies by conveyancer |
| ACT | 30-42 days | PEXA available | Standard contract specifies period |
| NT | 42 days | Paper-based common | Electronic settlement growing |
What Can Go Wrong
While most settlements proceed smoothly, problems can arise that delay or complicate the process:
Delayed Settlement
The most common issue is one party not being ready to settle on the agreed date. Causes include:
- Lender delays: The buyer's lender may not have the loan documents or funds ready in time. This is the most common cause of settlement delays.
- Chain delays: If either party is buying and selling simultaneously, a delay in one transaction can cascade to the other.
- Outstanding requirements: Missing documents, unsigned forms, or incomplete searches can hold up settlement.
- Vendor mortgage discharge: The vendor's bank may be slow to process the discharge of their existing mortgage.
Penalties for Late Settlement
The party at fault usually pays penalty interest (commonly 10-12% per annum on the outstanding balance) for each day of delay. If the delay extends beyond 14 days, the other party may issue a notice to complete. If settlement still does not occur after the notice expires, the innocent party may terminate the contract and claim damages.
Issues Found at Pre-Settlement Inspection
If the pre-settlement inspection reveals problems — such as damage to the property, missing fixtures, or undisclosed changes — your conveyancer will negotiate with the vendor. Options include:
- A reduction in the purchase price to cover repairs
- A holdback of funds in trust until the issue is rectified
- The vendor making repairs before settlement
- In serious cases, delaying settlement until the issue is resolved
Early Settlement and Late Settlement Options
Can You Settle Early?
Yes, both parties can agree to settle earlier than the date specified in the contract. This requires mutual consent — neither party can unilaterally force an early settlement. Reasons for early settlement include:
- The buyer wants to move in sooner
- The vendor needs funds earlier
- Both parties' finance and documentation are ready ahead of schedule
Your conveyancer can request an early settlement through the other party's conveyancer. If both parties agree, the settlement date is simply brought forward.
Can You Extend Settlement?
If you need more time, you can request a settlement extension. However, the other party is not obligated to agree. If they do not consent, you risk being in breach of contract and may face penalty interest or a notice to complete.
If you know your settlement will be delayed (e.g., due to a slow lender), notify your conveyancer as early as possible so they can negotiate an extension before the due date. It is far better to negotiate proactively than to default on settlement day.
Settlement Costs
On settlement day, the buyer is responsible for several costs beyond the purchase price:
- Stamp duty: The largest additional cost, varying by state and property value
- Legal/conveyancing fees: Your solicitor or conveyancer's fees for managing the transaction (typically $800-$2,500 plus disbursements)
- Lender fees: Loan establishment fees, mortgage registration fees
- Transfer registration fee: The fee for lodging the transfer of ownership with the land titles office
- Rate adjustments: Council rates, water rates, and strata levies are adjusted between buyer and vendor as at the settlement date — see our glossary entry on settlement adjustments for how these are calculated
- Insurance: Building insurance from the date of exchange (or settlement, depending on the state)
Settlement is a structured process that runs smoothly in the vast majority of cases, especially when both parties have competent conveyancers and responsive lenders. The key to a stress-free settlement is preparation: ensure your finance is in order, respond promptly to any requests from your conveyancer, and complete your pre-settlement inspection well before the due date. If anything goes wrong, your conveyancer is your first point of contact — they deal with settlement issues every day.
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Get Started FreeFor related information, see our guide on how long settlement takes, the complete guide to conveyancing in Australia, and our article on the first 30 days after settlement.