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Update for Off-the-Plan contracts in NSW – the government wants your say

Ron Zucker, Eollyn Cortes, Sagang Chung and Julia Zou
2 min read

The NSW Government is proposing reforms which aim to enhance confidence in the housing market by addressing issues related to off-the-plan purchases. In particular the Government aims to improve protection for purchasers and prevent developers from delaying the development of property against the development milestones.  



Proposed Reforms


The reforms released for comment by way of consultation intend to tighten the developer and the purchaser’s contractual obligations and provide the purchaser with greater clarity and transparency for protection:


  1. Mandatory Disclosure: developers must disclose additional project details, such as development approval status and site ownership, to set realistic purchaser expectations.

  2. Mandatory Sunset Clauses: all off-the-plan contracts must include a sunset clause with a specific date for subdivision registration and occupation certificate issuance, allowing purchaser s to withdraw if unmet.

  3. Expanded Sunset Events: additional conditional events, like development approval, require court approval for contract termination, beyond current sunset events.

  4. Sunset Date Obligations and Extension Caps: potential legislative caps on extending sunset dates, with obligations for developers to meet these dates. If rescission is approved, damages may include capital gains from rising land values.

  5. Notice of Purchaser’s Contractual Interest: allowing a caveat on the development land title to record the purchaser’s interest. 


Have your say


The Contracts and Covenants consultation is open until 07 March 2025 for submission. Whether you are a developer or a purchaser of an off-the-plan contract, you can have your say in the reform at:

 

Key Takeaway 


For more information about your proposed development or, if you are seeking to purchase a  property off-the-plan, please contact one of our people.


Ron Zucker 0410 590 111

Eollyn Cortes 0478 727 395

Sagang Chung 0431 435 333

Julia Zou 0426 670 202

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