Complying with Property Contract Conditions - NSW

What are contract conditions?

If the contract is subject to certain conditions (such as the Purchaser obtaining finance approval or a satisfactory building and pest inspection report, or the Vendor becoming the legal owner of the property) by certain deadlines, actions must be taken to satisfy the conditions, otherwise, one or both parties can exercise their rights of rescission by the relevant deadlines.

It is uncommon that Vendors of properties in New South Wales, especially within Greater Sydney, are agreeable to the contract being subject to the Purchasers obtaining satisfactory finance approval, building and pest inspection, strata or community title inspection report. Purchasers usually must obtain these and — if required — exercise their rescission rights prior to exchanging the contract, or during the cooling off period.

What steps must I take to ensure compliance with the conditions of the contract?

If you are the party that must satisfy any contract conditions, it is important to undertake all the steps related to these conditions to ensure compliance with the terms of the contract.

Should any issues be identified that significantly affect the property's value or condition, Purchasers may want to negotiate repairs or adjustments with the Vendor, or exercise their right to rescind the contract.

Understanding and adhering to these procedures helps safeguard the Purchaser's interests and ensures that all contractual obligations are met in a timely and efficient manner.

Failure to comply with these conditions can result in the forfeiture of deposits or other penalties, making it essential to manage these steps diligently.

If the Vendor needs to satisfy any contract conditions, it is important that you are aware of requirements and deadlines of the conditions so that you can make the appropriate decisions, including rescission or termination of contract, when required.