What happens if a buyer defaults in Queensland?
A buyer defaults when they fail to meet an obligation under the contract — most often by not paying the deposit on time, not securing finance, or not completing the purchase by the settlement date. Queensland's standard contract makes time of the essence, so if the buyer can't complete on the agreed date the seller has several remedies to recover their position.
The seller is generally entitled to:
- Resume possession of the property.
- Retain the deposit.
- Resell the property, and recover the costs of reselling — including any shortfall if it sells for less.
- Sue for damages, or seek specific performance to compel the buyer to complete.
Can the seller keep the deposit and still sue for more?
Yes. Retaining the deposit and suing for damages compensates the seller for the harm caused by the buyer's failure to complete, and reselling — with the right to recover related costs and any shortfall from the defaulting buyer — lets the seller move forward even if the resale price is lower.
A worked example: what a resale deficiency can cost (illustrative only)
These figures are hypothetical — they show how the numbers can stack up. Your actual position depends on the contract, the resale and the court.
| Item | Amount |
|---|---|
| Original purchase price | $900,000 |
| Deposit forfeited by the buyer (10%) | $90,000 |
| Seller resells within a reasonable time at | $780,000 |
| Shortfall on the resale | $120,000 |
| Resale costs (agent, marketing, legal) | $20,000 |
| Total loss to the seller | $140,000 |
| Less deposit already forfeited | -$90,000 |
| Further amount the seller can claim from the buyer | $50,000 |
The takeaway: a defaulting buyer can lose the deposit and be pursued for the rest of the seller's loss — the exposure isn't capped at the deposit.
Affirm or terminate: the seller's two paths
Faced with a default, the seller generally takes one of two routes:
- Affirm the contract — hold the buyer to the purchase and seek specific performance (a court order compelling them to complete), typically with default interest running on the unpaid balance.
- Terminate the contract — end the contract, resume possession, forfeit the deposit, and sue for damages and any resale shortfall.
How can a buyer avoid defaulting at settlement?
Under Queensland's standard contract, either party can extend the settlement date by up to five business days in total by giving written notice, without needing the other's agreement. A buyer facing a short, unexpected delay — funds not yet cleared, for instance — can use this to avoid missing settlement. If you think you might not settle on time, tell your conveyancer as early as possible.
General information only — not legal advice. Confirm your situation with a licensed conveyancer or solicitor.
