Changes to REIQ Contracts for Houses and Land coming in January 2022


The Real Estate Institute of Queensland (“REIQ”) and the Queensland Law Society (“QLS”) have announced that the new standard contracts for sales of houses, land and residential units will be released in late January. The changes have been introduced to resolve some issues faced by buyers and sellers when dealing with financial delays to settlement, in addition to updating a number of standard terms and making clear some commonly disputed dates that arise under the contract.

Right to extend settlement

A new clause is being inserted into both house and land and community title contracts to provide a unilateral right to extend the settlement date, if one party is unable to settle due to issues with their bank. It sets out specific requirements on how a party must seek to extend the settlement date and restricts any extension to a date no later than 5 business days after the intended settlement date.

The new extension clause will assist buyers, as incoming banks can sometimes be unprepared to settle on the specified date leading to a flurry of negotiations between the parties to extend the date, potential default interest and other fees applying, and even for the buyer to lose the contract and be pursued for damages by the seller.

The changes will allow for the parties to approach settlement as a more flexible date and will hopefully allow for some first home buyers who are usually the ones to be hit by these delays to have more peace of mind when entering their contracts. 

On the flipside, the extension may also raise various issues for parties who intend to sell their existing home and move into a new home, and both contracts are intended to settle on the same day. If a buyer gives notice that they won’t be able to settle quite late in the day (i.e., before the 4pm deadline) this may require an equally quick notice to the contracted seller on the same terms. While it is likely that the parties would be able to negotiate this issue before the specific deadline, removalists and other time-sensitive agreements will  likely be less flexible.

It is possible that an outgoing seller may have their house and all their worldly possessions packed up at 11am, just to find that the house they were going to move into is not available for another 5 business days and they now face a relatively hefty bill from the removalists to hold their items for another week. Further legal or other fees may also be applicable in instructing their solicitors to move the settlement to the new date, recalculate all adjustments and ensure that all parties will be ready to settle on the specific date. Parties may also be restricted from seeking these costs from the other party should a correct extension request be received.

Payment of Deposit

The amendments also seek to change the interpretation of when a deposit is paid. Many a contract has almost fallen over due to a deposit or balance deposit being paid on the day it was due, but not received until a day or even two days later.

These new contracts now specify that the date a deposit is paid is deemed to be the date where an EFT transaction is made. That means if a party makes payment of the deposit at 4:50pm on a Friday, but it does not come in until the Monday or Tuesday, the other party will not be able to rely on that delay to terminate the contract. Parties should ensure they should provide receipts upon any payment of deposit to avoid any disputes.

The amendment is likely to be a welcome change to many practitioners who have engaged in arguments on payment of deposit and provides a welcome clarity for parties to ensure a deposit has been paid.

Smoke Alarms and Pool Safety Certificates

One of the potentially complicating amendments to the standard contracts  are the amendments to the smoke alarm and pool safety clauses. These are summarised as follows.

  1. Smoke Alarm

It is a requirement that compliant smoke alarms must be installed within the property prior to the settlement date. Should a seller fail to comply with this obligation, the Buyer is entitled to an adjustment in their favour of equal to 0.15% of the purchase price.

  1. Pool Safety Certificates

Sellers are required to hand over a Pool Safety Certificate for a non-shared pool (i.e., not a pool on common land) on or before settlement. Should no Pool Safety Certificate be available, they must provide a Notice of No Pool Safety Certificate prior to the contract. Failure of the seller to provide this certificate on or before settlement will allow a buyer to terminate the contract.

Confusion around when a contract is dated when signing electronically has also been resolved, with the date being the date automatically inputted upon electronic signature, or if no date is inputted, the date the last party signs the contract. The amendments also include a new termination right for a buyer should services infrastructure pass through the land and not be protected by a registered easement, and this infrastructure is not disclosed to the buyer upon signing the contract.

Should you require any assistance with buying or selling a property, reach out to one of our friendly property lawyers today.   


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Changes to REIQ Contracts for Houses and Land coming in January 2022

The Real Estate Institute of Queensland (“REIQ”) and the Queensland Law Society (“QLS”) have announced that the new standard contracts for sales of houses, land and residential units will be released in late January. The changes have been introduced to resolve some issues faced by buyers and sellers when dealing with financial delays to settlement, in addition to updating a number of issues.

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