[Video] Conveyancing Process For Purchasing Property in Victoria

Buying a property in Victoria is an exciting journey, but the legal process can be complex. Conveyancing is a crucial part of the transaction, ensuring that all legal aspects are in order before settlement. Below, we outline key considerations to help buyers navigate the conveyancing process smoothly.

In this video, Liz Zaki, Mortgage Broker at OneSite Finance interviews Gregoria Wood, Principal Solicitor at GW Solicitors to delve into the conveyancing process in Victoria.

Why Should Clients Have a Contract Reviewed Before Signing?

Before signing a contract, it’s essential to understand its implications. A contract review helps determine whether the property suits the buyer’s intended use—whether for personal residence, investment, or redevelopment. A thorough review can identify restrictions, zoning regulations, and other limitations that may impact the buyer’s plans. Additionally, reviewing the contract helps assess potential risks, including tax implications, stamp duty obligations, penalties, insurance requirements, and hidden fees.

When Should Clients Contact a Conveyancer for a Contract Review?

Ideally, buyers should engage a conveyancer as early as possible—even before negotiating the purchase price. A pre-emptive contract review can highlight any clauses that might affect the buyer’s decision, ensuring they are fully informed before making an offer. Early engagement also helps manage deadlines and ensures compliance with legal timelines.

What Conditions Can Be Included in the Contract?

Buyers can include various conditions in the contract to protect their interests. Common conditions include:

• Subject to Finance Clause – Typically allows up to two weeks for formal loan approval.
• Building & Pest Inspection Clause – Generally permits two weeks for inspections unless a shorter timeframe (e.g., seven days) is specified in the contract.

These conditions provide buyers with flexibility and an exit option should financing or inspections reveal issues.

Cooling-Off Periods – When Do They Apply?

In Victoria, when the price is agreed, buyers generally put down a $1,000 deposit to secure the purchase. Buyers need to put the rest of the 10% deposit by an allocated date within 3 to 7 days (cooling-off periods).

However, exceptions apply:

• No cooling-off period applies if the property was purchased at auction.
• If the buyer withdraws within the cooling-off period, a penalty of either 0.2% of the purchase price or $100 (whichever is greater) is usually incurred. This depends on the contract conditions as well.

Unconditional vs. Conditional Contracts

A conditional contract includes clauses such as subject to finance or building and pest inspections. Once these conditions are met, the contract becomes unconditional, meaning both parties are locked into the transaction until settlement. However, auction purchases are automatically unconditional, meaning buyers cannot withdraw once they sign the contract. 3 days before, and 3 days after an auction in Victoria, no cooling off provisions applies. This means Buyers can’t cancel the contract. Buyers are obliged to purchase the property. If Buyers choose to still cancel the contract, then Buyers forfeit their deposit and other legal penalties could also apply.

Penalties for Late Settlement in Victoria

Failing to settle on time can be costly. In Victoria, the penalty is typically the current cash rate plus 2%, calculated daily. Other potential costs include:

• Additional fees payable to the vendor
• Interest on the vendor’s mortgage
• Costs of a bridging loan (if applicable)
• Storage and accommodation expenses if the buyer is unable to move in on time Each contract may include specific penalty clauses, so buyers should review their agreements carefully.

Can Everything Be Signed Digitally?

Yes! In Victoria, contracts and related documents can be signed electronically via DocuSign or similar platforms. Additionally, identity verification can be done online, making the process seamless—especially for interstate or overseas buyers.

When Should Buyers Take Out Building Insurance?

While standard Victorian contracts state that the property remains at the vendor’s risk until settlement, buyers are advised to arrange building insurance immediately after signing the contract. This precaution protects against unforeseen damages that may not be covered by the vendor’s insurance. Some lenders may also require proof of insurance before finalising the loan.

Navigating the conveyancing process requires careful attention to legal and financial details. Engaging a conveyancer early, understanding contract conditions, and securing insurance promptly can help buyers avoid complications and ensure a smooth property transaction in Victoria.