The Real Estate Institute of New South Wales (REINSW) proposes amendments to the Conveyancing Act 1919 in order to facilitate the waiver of the cooling-off period for buyers.
In a communication to NSW Fair Trading, REINSW requested an amendment to article 66W (1) (d), which requires buyers to seek a lawyer or licensed carrier to explain the effect of the sales contract before renouncing their right to terminate the sale and purchase contract of land.
Requiring buyers to obtain legal advice raises practical concerns, REINSW explained.
"What happens if the buyer makes an offer after the COB on Friday and the property is put up for auction on Saturday morning? It is unlikely that the buyer will be able to find a lawyer or an approved carrier who is able to explain the effect of the contract with them before the auction, "said REINSW.
Read also: Significant "hidden" costs of buying a property
In such situations, the seller finds himself in the dilemma of accepting an offer that can later be canceled and wasting the auction fees incurred or of refusing the offer and risking to sell cheaper at auction.
While the current rules aim to protect buyers from gas, where the seller increases the contract price of a property after informally accepting a lower offer, REINSW said the reverse is true product due to the measures in place.
"This is due to the fact that a buyer who is willing to waive their right of withdrawal simply cannot provide the certificate quickly enough. He may not be able to access a lawyer or a licensed carrier to explain the effect of the contract and, meanwhile, another buyer has the option to get started, "said REINSW.
Learn more: What are your rights as a buyer in the event of late payment?
The burden is heavier for unrepresented buyers, as they do not have immediate access to a lawyer or a licensed carrier.
REINSW said lawyers should only be required to explain the nature of the waiver certificate and its effect on sellers.
"REINSW believes that by removing the requirement these practical problems can be avoided. Buyers will be free to waive the cooling-off period after receiving general advice limited to nature and 39; effect of certificate, "said REINSW.
In addition, the cooling-off provisions are in fact already in place under the 2019 land sale and purchase contract and the existing provision under the Transfer Act requiring sellers to include certain regulatory conditions in the sales contract.
"This amendment will improve the efficiency of real estate transactions and protect buyers from suspended gas. It will also maintain the essential requirement that buyers be informed of the effect of the surrender of their right to a period of reflection, "said REINSW.
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