You have a right to terminate the contract if you change your mind. This right exists only for a limited time, and is called a Cooling-off Period.
The Cooling-off Period starts on the day a Buyer receives from the Seller or the Real Estate Agent a copy of the Contract signed by both parties or, if that day is not a business day, on the next business day.
If the Seller signed the Contract before the Buyer, the Cooling-off Period starts on the day the Buyer signed the Contract and communicated their acceptance to the Seller.
If the cooling-off period applies to a Contract, the cooling-off period starts on the day the Buyer receives from the Seller or the real estate agent a copy of the Contract signed by both parties or, if that day is not a business day, on the next business day. If the Seller signed the Contract first, the cooling-off period starts on the day the Buyer signed the Contract and communicated this acceptance to the Seller.
The cooling-off period ends at 5pm on the fifth business day.
The Cooling-off period is a critical consumer protection mechanism that allows buyers to withdraw from a contract within a specified time frame without incurring significant penalties. This period, typically five business days, serves as a safeguard against impulsive or pressured decisions.
It allows buyers to review the terms of the contract thoroughly, seek legal advice if necessary, and ensure that the decision aligns with their best interests. The conditions attached to the Cooling-off period, such as the precise timing of its commencement, are designed to ensure clarity and fairness for both parties involved in the transaction.
Understanding and utilising the Cooling-off period effectively can prevent future disputes and financial losses, emphasising the importance of being well-informed about one’s rights in contractual agreements.
If the Buyer terminates during the Cooling Off Period, the Seller may retain a penalty of 0.25% of the purchase price from the deposit paid under the Contract. The Seller must refund the balance of the deposit (if any) to the Buyer within 14 days of termination.
The Buyer can shorten the cooling-off period or waive the benefit of it entirely by giving written notice to the Seller.
The Property Occupations Act 2014 cooling-off provisions apply to the sale of residential property, except where:
It is critical that you communicate your decision to the Seller prior to 5pm on the last day of the cooling-off period. It is not enough to tell your Conveyancer by that time, you need to give your conveyancer enough time to communicate that you are cooling-off. Don’t leave it until the last minute.
No, there is no ability to cool-off on Auction property transactions.
A contract is exempt from the cooling-off period for:
The cooling-off period also doesn’t apply if the buyer is:
The time limit to exercise any Cooling-off rights is five business days only and subject to a range of conditions.
If you terminate the Contract during the cooling-off period, the Seller is entitled to retain 0.25% of the Contract price. The balance of any deposit must then be returned to you.
It is critical that you communicate your decision to the Seller prior to 5pm on the last day of the cooling-off period. It is not enough to tell your Conveyancer by that time, you need to give your conveyancer enough time to communicate that you are cooling-off. Don’t leave it until the last minute.
No, there is no ability to cool-off on Auction property transactions.
Disclaimer: Every property transaction is different, and the information provided may not be relevant to your circumstances. By using this site you agree that the information provided is for general purposes only and does not constitute legal, financial, or professional advice.
