More protection for off-the-plan buyers
The changes follow a public consultation and include:
- Buyers provided with a copy of the proposed plan, proposed by-laws and a schedule of finishes before contracts are signed.
- Vendors provide a copy of the final plan (and notice of changes) at least 21 days before the buyer is made to settle.
- Buyers allowed to terminate the contract or claim compensation if they are greatly affected by changes made from what was disclosed.
- Expanding existing legislation to clarify that the Supreme Court can award damages where the vendor terminates under a sunset clause.
- Extending the cooling off period to 10 business days with deposits held in a controlled account.
Minister for Finance, Services and Property Victor Dominello said the number of off-the-plan sales has increased from just over 2000 in 2006/07 to nearly 30,000 in the last financial year, which accounts for about 12 per cent of all residential property sales in NSW.
“Buying off-the-plan has become more popular among first home buyers in recent years. While it works well in most cases, we’ve all heard the horror stories when things go wrong,” Mr Dominello said.
“The new laws will bolster existing protections for buyers, by establishing minimum disclosure standards and ensuring that developers are held accountable for delivering what they promised at the time of purchase. We have also given the Supreme Court additional powers to stamp out misuse of sunset clauses by developers.”