GOVERNMENT ACTS ON UNCERTAINTIES
NEW laws passed by State Parliament this month aim to support the release of new subdivisions onto the property market while also protecting buyers.
The Sale of Land Amendment Act 2016 is intended to clarify the obligations of developers and buyers when purchasing a lot off the plan and provide greater transparency for buyers.
It has been common practice for developers to sell lots in a subdivision before obtaining the relevant approvals and land titles in order to fund their developments. For buyers, this created the risk that the finance for the development could fall through or an unscrupulous developer could abscond with their deposits.
Lands Minister Terry Redman said the new legislation would make developers’ obligations clear.
“Under the new laws, developers will be required to meet consumer protection measures before entering into sales contracts,” he said.
“These include becoming the registered owner of the lot by a deadline set out in the sales contract and having all deposits held in trust accounts.
“Having deposits held in trust accounts will ensure buyers are able to obtain refunds should finance for the development fall through.”
Sales contracts will also contain warnings that the developer is not the registered owner of the lot and will explain buyer’s rights.
“These amendments will clear up uncertainties, better protecting buyers while also supporting the release of affordable new lots and subdivisions into the market," Mr Redman said.
The new laws come into effect on March 31, 2017.