When buying real property in Queensland, you must consider adding special condition clauses to your contract. Three key areas to consider are:
- Professional cleaning.
- Chattels to be included.
- Building and pest inspection outcomes.
Professional cleaning
If you’re buying a property with vacant possession so you can live there or rent out later, you must be aware there’s no requirement for the property to be cleaned (professionally or otherwise) for handover at settlement.
If tenants under the vendor (i.e. the current landlord until property settlement) are due to leave before the property settlement (or due to the lease ending), then buyers must be clear that the any property cleaning is an agreement between the property manager and the tenant—not the vendor/seller. This means that the property may be professionally cleaned under the bond release agreement, or it may be left to the property manager’s discretion as to whether the property needs a clean. Either way, the exchange of bond happens between the property manager and the tenant, and there’s no other recourse for any other party involved i.e. the vendor/seller or the buyer.
To protect yourself from being handed a hot mess or even damage created by the moving out process, buyers must consult with a solicitor to get the right clause into the contract, commonly the ‘special conditions’ clauses. For example:
“If the property is not professionally cleaned by pre-settlement inspection date, $2,000 will be withheld from the settlement amount.”
Chattels to be included
In Queensland, the term "chattels" refers to movable items of personal property included in the sale of real property. When you purchase a property, the sale agreement will specify which chattels are included in the sale. Common or standard chattels that might be included in a property sale agreement are:
- Air conditioning and dishwashers.
- Curtains and blinds.
- Light fixtures and fans.
Whereas you might be assuming a few inclusions based on property features that either aren’t movable or are attached to the feature. For example, if the property has a pool, you might assume that the pool cover, pool pump, and pool cleaning equipment will be included. Here are some examples of other chattels that you could add to the sale agreement, either by negotiation or for contract clarity:
- Landscaping. Raised garden beds, plants in pots, or a special property feature e.g. a statue.
- Garden equipment. Water tanks, lawn mowers, garden tools, and outdoor furniture.
- Equipment. Surveillance/intercoms, sound systems, and home theatres.
- Furniture. Sofas, tables, chairs, and beds, if specified.
It's important to clearly list all chattels to be included in the sale agreement to avoid any misunderstandings. If an item is not listed, it is assumed not to be included in the sale.
To ensure all relevant chattels are properly documented in the sale agreement, buyers must consult with a solicitor to get the right clause into the contract, commonly the ‘special conditions’ clauses. For example:
“The property’s chattels include x y z and in particular the raised garden beds and the plants in those raised garden beds, which are located through the property, front and back.”
Building and pest inspection outcomes
A building and pest inspection is completed after the contract is signed and is at the buyer’s expense. It’s beneficial for buyers to attend these inspections to understand what was included in the inspection and understand its findings. This intel is critical to share with your solicitor so that any outcomes from the building and pest inspections can be acted upon effectively and fairly. The inspection may be conducted by one or more experts (a building specialist and a pest expert) to inspect and report on:
- The structure of the roof, walls, floors, fences and any adjoining buildings. Assess cracks, faults, asbestos, and building movement.
- Termites, white ants, borers and other pests.
Depending on the inspection report’s outcomes, and the cost/work required to remedy any concerns, buyers should work with their solicitor to consider negotiating a price reduction. This must be done with a solicitor and not the real estate agent.
To ensure the sale/purchase agreement provides for a price reduction to be negotiated, a special clause should be added. For example:
“If the building and pest inspection report reveals that x work is required to remedy, then the vendor/seller agrees to consider a reasonable price reduction by negotiation with the buyer’s nominated solicitor.”
If the contract price is adjusted further to a special condition clause such as the above, it may be that both the valuation report and finance approval will need to be redone.
Importantly, regardless of any of the standard and special clauses in the agreement, buyers must let solicitor know if any problems are revealed in the pre-settlement inspection. Then the solicitor can negotiate for them.
Disclaimer: These are just suggestions, not legal advice, consulting with a solicitor is strongly recommended.
