A sale and purchase agreement is a legally binding contract between you and the seller.
A sale and purchase agreement is a legally binding contract between you and the seller.
It sets out all the details, terms and conditions of the sale — this includes things such as the price, any chattels being sold with the property, whether the buyer needs to sell another property first and the settlement date.
A sale and purchase agreement provides certainty to you and the seller about what will happen when.
There is no universal sale and purchase agreement — there are multiple agreements available and being used by various agencies, each with different clauses and conditions buyers and sellers should be aware of. The information on this page should give you a general idea of what is in a sale and purchase agreement but you should always get legal advice before you sign
To obtain a sale and purchase agreement you’ll need to contact your lawyer or conveyancer or a licenced real estate professional. You can also purchase printed and digital sale and purchase agreement forms online.
This guide tells you:
Your sale and purchase agreement should include the following:
The sale and purchase agreement includes general obligations and conditions that you will need to comply with. These may include the following:
Your lawyer or conveyancer will explain these clauses to you.
You can present an unconditional offer, which means there are no specific conditions to be fulfilled, or you can include one or more conditions (that must be fulfilled by a specified date) in your offer. Ask your lawyer or conveyancer to review the sale and purchase agreement and any conditions you include before you sign it. These are some common conditions:
This is done by your lawyer or conveyancer to check who the legal owner of the property is and to see if there are any other interests over the property such as caveats or easements. Learn more about titles
This refers to you being able to arrange payment, for example, a mortgage or a loan. Some agreements may stipulate (for the benefit of the vendor) that if you are unable to secure financing and cannot to satisfy this condition, you will need to supply evidence from your bank confirming your finance was declined. If you cannot supply supporting evidence, you may still be required to proceed with the sale. Learn more about financing
A sunset clause is the date and time your offer expires. Adding a sunset clause to the sale and purchase agreement allows you to have certainty that your offer has either been accepted or declined by that date and time so you are free to offer on other properties. If you make an offer on another property while you are waiting to hear back about your first offer, you could end up in a situation where both offers are accepted and you have committed to buy two properties.
A bank may require you to obtain a valuation of the property (an estimate of the property’s worth on the current market) before they agree to a loan. Read more about valuations
Provided by the local council, this report provides information about the property such as rates, building permits and consents, drainage, planning and other important information. Read more about LIM's
If this is a condition of the sale you can use who you like to inspect the property, but we recommend using a registered property inspector. If the report isn’t satisfactory to you, you may be able to withdraw your offer on those grounds, but the vendor may ask to see a physical copy of the builder's report. Read more about the property inspection reports
You can request a report to detect if a property has been contaminated by the preparation, manufacturing or use of drugs (including methamphetamine). Unless there is strong suspicion or information from Police or forensic experts that a property has been the site of production or heavy use of methamphetamine it may not be necessary to commission a report. Talk to your lawyer or the real estate agent before making an offer if you are concerned the property may be affected. Read more about meth contamination
Similar to a property inspection report but more focused on the entire section and the structure of the property.
You may need to sell your existing home in order to buy another. You may add in the condition that the contract is conditional upon securing an unconditional contract for the sale of your own home first by a certain date.
Talk to your lawyer about what might happen if COVID-19 impacts you or the other party. You may want to include a condition in your agreement about what happens if you are unable to settle on settlement day.
Fixtures are permanently attached to the property (for example, a deck, showers and electrical wiring) and are included with the land title. All other moveable items are chattels and are only included in the sale if they are listed in the sale and purchase agreement.
Chattels are personal property that is not fixed to the property and can be removed without causing damage. A sale and purchase agreement includes a list of standard chattels. The list can be altered by the buyer or seller to include any chattels the parties agree to include in the property sale.
Standard chattels include:
It’s important for buyers to ask what chattels would remain in the house — if it isn’t included on the list of chattels, the vendor is within their rights to take the chattel with them. The listed chattels should be in working order and in the same condition as they were when you signed the sale and purchase agreement.
It’s a good idea to talk to the real estate agent and to follow up in writing to confirm the specific chattels, for example, the make and model of the stove to ensure it isn't changed or removed by the vendors. If you are in doubt about whether something is a chattel or a fixture, you should include it in the chattels list. This way, it will be clear what items you are buying with the property.
Signing the sale and purchase agreement is not the end of the purchase process.
A conditional agreement means the sale and purchase agreement has one or more conditions that must be met by a specified date.
Depending on what the agreement says, you may pay the deposit when you and the seller have both signed the agreement or when the agreement becomes unconditional. Buyers usually pay the deposit by bank transfer. Make sure you talk to your bank beforehand to make sure the money is available. If the sale is by tender, you provide a cheque or bank transfer for the deposit amount when you make the offer.
If you have not paid the deposit by the agreed time, then the seller’s lawyer may inform you that you have three working days to pay. If you do not pay the deposit in that time the seller can cancel the contract at any time by serving notice of cancellation on you. However, if you pay the deposit before that notice is served, the agreement will not be cancelled, even if they serve the notice on you.
When you’ve signed the sale and purchase agreement and any conditions set out in it have been met, you must complete the purchase of the property.
When the sale is complete, the seller pays the agent for their services. The agent or agency usually takes the commission from the deposit they’re holding in their trust account. The agent cannot ask you to pay for their services if they have been hired by the seller.
You pay the remainder of the amount for the property on the day of settlement, usually through your lawyer or conveyancer.
The agreement for sale and purchase may contain a specific date for possession that may differ from the settlement date, for instance, where the property is tenanted. If the property is tenanted, the agreement for sale and purchase should specify this.
If you require the property to be sold with vacant possession, it is the seller’s responsibility to give the tenant notice to vacate, in accordance with the tenant's legal rights.
We recommend you seek legal advice if you are buying a property that is currently tenanted.
