New REIQ residential contracts released 20 January 2022
New editions of the Contract for Houses and Residential Land (17th ed.) and Contract for Residential Lots in a Community Titles Scheme (13th ed.) are now available! You are required to use the new versions of the residential contracts from 20 January 2022.
The changes include:
- Definition of Contract Date has been amended to accommodate signing of electronic contracts in Realworks.
- The ability of either party to obtain a short extension to settlement where the party is unable to settle due to the inaction or delay of a financier or for any other reason. The new clause 6.2 responds to ongoing difficulties faced by buyers who have been unable to settle on time, leading in some cases to contracts being terminated. This change to "time of the essence" will alleviate the circumstance where buyers are potentially unfairly affected by delays outside of their control.
- New smoke alarm clause 7.8, responding to changes to smoke alarm regulations on 1 January 2022. The current editions can continue to be used up to 20 January 2022 but the new clause will impose a contractual obligation on the seller to install smoke alarms in compliance with the new requirements without delaying settlement.
- Express provision for paying a deposit by direct debit and a grace period allowed to address the impact of delays in the deposit of money to accounts when using direct debit.
- Amendments to the Pool Compliance Certificate obligations. A seller is required to hand over a pool compliance certificate for a non-shared pool on the land at settlement. The only exception to this obligation is if a Notice of No Pool Safety Certificate is given to the buyer prior to contract.
- Seller warranties in clause 7.4 have also been renumbered and a new warranty has been added. The seller will now warrant that they have not received communication from a competent authority that may lead to the issue of a show cause or enforcement notice or a notice to do work referred to under clause 7.6. The reason for adding the new warranty is that in practice local governments correspond with owners for a considerable period without issuing a formal non-compliance notice. On becoming aware of the proposed sale of a property (usually when a buyer does a search) council may issue a formal notice, which under the present clause 7.6 is the buyer's responsibility. This seems an unfair result and the new clause is intended to overcome this issue.
- Amendments to clause 7.5 regarding services infrastructure located on the land but unrelated to services provided to the land. This includes a new right to terminate if infrastructure unrelated to delivery of services (gas, electricity, water, sewerage) to the Land pass through the Land and are not protected by a registered easement, BMS or statutory authority that has been disclosed to the buyer.
- Amendments to clause 7.6 to change the responsibility for notices to do work, depending on when the notice is issued (prior to or after contract), when compliance with the notice is required (before or after settlement) and whether the notice is disclosed by the seller to the buyer prior to contract.
Download your copy of the contract changes FAQ's.
Realworks users have access to a free webinar hosted by the REIQ, which provides an overview of the changes to the contracts.
If you would like access to the webinar, please phone 1300 MY REIQ.
REIQ Members can access the webinar under CPD Resources of your Member Portal.
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