Property development in Canberra is booming, with a swag of new land releases open to the public over the past few years, and new developments popping up right across the territory – from Tuggeranong to Kingston, Braddon, Belconnen and Gungahlin.
It’s exciting times for many Canberrans, who have had the opportunity to secure never-before-lived on land, or snap up brand new lavishly-built apartments and townhouses.
But not everyone has a happy story to tell, with Access Canberra confirming a steep increase in the number of logged complaints in relation to building works in the ACT. Common issues include quality of works, defects and warranties, and non-completion of works.
If you’re about to embark on a new home build, it pays to do a bit of reconnaissance beforehand, so you know what you’re getting yourself into and can take certain measures to maximise your chances of a successful build.
RiotACT sat down with Christina McPherson from Baker Deane & Nutt (BD&N) lawyers to find out the common pitfalls, and how to avoid them.
“Buying a property, whether it be your first home or an investment property, involves financial risk. For many, it will be the largest single investment they ever make – so it’s important to get someone on your side early, who has the expertise to help you avoid or resolve complications”.
“Compared to a conveyancer, solicitors have a comprehensive knowledge of both the conveyancing process and of broader legal issues. This means they can guide you through more complex scenarios, support you in understanding your rights if something goes wrong, and walk you through other areas that are affected when you buy a new home – such as tax implications”.
“(At BD&N) we have a large conveyancing team, which includes a licenced conveyancer. However, we also have a firm policy that our clients always receive legal advice from a solicitor to ensure they’re getting the breadth of a solicitor’s expertise.”
When it comes to buying a new home, Christina lists 5 common pitfalls:
- Not having a proper understanding of the completion date and the circumstances in which the seller can extend the settlement date. “It can be very disheartening for a buyer when they expect to start building on a particular date, or to be moving in within a specific timeframe, and the seller extends the settlement date”.
- Not knowing what to do, or your rights, if the contract is terminated by the seller. This is particularly concerning for the buyer if they’re forced to forfeit their 10% deposit. Understanding the contract before signing, and your rights thereafter, is crucial.
- The different implications between purchasing a property via ballot, tender and auction. These variations affect a buyer’s ability to negotiate terms in the contract, and whether a 5 day cooling off period applies.
- Failing to apply for available concessions or grants. Or, not fully understanding how to apply for the ACT land rent scheme, and what it means moving forward.
- Not being aware of the many building restrictions impacting most of the new suburbs, and the effects this can have on your building design, and your obligations into the future.
“It’s also really important to understand the timeframes that can apply when you purchase an unregistered block of land in the ACT. Often, the period between exchange and settlement can be 12 months or longer. However, once the seller gives you a notice of registration (that the block has officially been created and therefore has its own title reference), you might only have 14 days to complete the purchase. If you can’t settle in this period, then penalty and interest provisions in the contract may commence”.
“At the end of the day, it’s about being prepared, and stepping into the process with eyes wide open. At BD&N, we strive to ensure you have a comprehensive understanding of the contract, and any issues that may arise throughout the transaction, to minimise your risk and ensure your peace of mind.”
For conveyancing and legal advice on buying/selling a new home in NSW or the ACT, property development, subdivision, property transfers, and loan and mortgage documents, call Christina on (02) 6299 3999 or visit Baker Deane & Nutt.
Original Article published by Rachel Ziv on The RiotACT.