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Off the Plan Property Sales or Selling off the plan occurs when a property developer sells apartments in a multi-storey building that has not yet been built yet. Sometimes the term ‘off the plan’ refers to subdivisions of vacant land. The same principles apply to both. What makes these contracts work is in the special conditions.
Whether strata plan or subdivision of vacant land, the Contract for Sale is based on the standard terms and conditions in the Contract for the Sale and Purchase of Land 2019 edition published under copyright by the Law Society of NSW and The Real Estate Institute of New South Wales, substantially altered with complex special conditions. The special conditions modify the Contract to make it an ‘off the plan’ contract.
With Off the Plan Property Sales, usually after the contract is signed and exchanged, a period of up to two years or more may elapse until completion. In this time the property is built, the strata plan lodged, and several more properties may be sold off the plan. Project finance for most residential strata developments is usually dependant on a minimum number of exchanged off the plan contracts.
The special conditions must allow the vendor sufficient time to build and allow for delays. At the same time it should bind the purchaser, and still be acceptable for the purchaser to sign.
All off the plan contracts are subject to the vendor effecting the registration of the strata plan or subdivision by a certain date (known as the sunset date).
A contract for the sale of land must satisfy statutory disclosure and warranty obligations. Failure to do so can make the contract unenforceable. The contract itself should contain the following:
- The Law Society Contract for the Sale and Purchase of Land 2019, including the standard terms and conditions;
- Special conditions that modify, add and delete various clauses in the Law Society terms and conditions; and
- Disclosure documents annexed to the contract.
Annex all relevant plans and documents which define the development proposal. Now you have your Contract.
Note that Changes to off-the-plan contract laws commenced on 1 December 2019. The precedent bundle has been adapted to the change in law and the new Contract for the Sale and Purchase of Land 2019 edition. A commentary on the changed laws is included with the bundle of precedents.
The Off the Plan Property Sales Agreement Bundle includes:
- Commentary regarding changes to off-the-plan contract laws that commenced on 1 December 2019.
- Special Conditions for Off the Plan Sales 2019
- Execution page
- List of Annexures to Contract
- Off the Plan contracts Disclosure Statement Form (approved form in Word format)
- Notice of Changes approved form (approved form in PDF and Word format)
- Letter to purchaser – providing particulars of plan registered
- Letter to purchaser’s solicitor giving notice plan is now registered and parties must settle
Note that the Contract for the Sale and Purchase of Land 2019 edition is not included in this bundle. The Contract for the Sale and Purchase of Land 2019 is published under copyright by the Law Society of NSW and The Real Estate Institute of New South Wales and may be purchased on the Law Society of NSW website for a cost of $8.00. A link to the Law Society of NSW website contract purchase page is included with the commentary.
The full Off The Plan Property Sales Bundle for
$275.00 including GST