The sellers of the property we are hoping to buy have appointed a conveyancing practitioner in Melbourne who has recommended a lock out contract with a non-refundable deposit 6,000. Is it wise to enter into such agreements?
This kind of contract is unusual in Melbourne, conveyancers will often direct clients away from them as they detract from focusing on the main conveyancing focus and if you end up having your deposit forfeited then the solicitor is left exposed. In addition, there is no certainty that just because the owner has entered into an exclusivity contract they will complete the sale with you. They may breach the agreement if they receive a big enough offer to do so because a wronged claimant with the benefit of a lockout agreement will still be duty bound to establish consequential losses from the breach and these may not equate the extra amount that the owner may gain by breaking the agreement, no matter how morally shameful the behaviour is.
I have been told that property searches are a common cause of obstruction in Melbourne conveyancing transactions. Is this right?
The Council of Property Search Organisations (CoPSO) published conclusions of research by MoveWithUs that conveyancing searches do not feature amongst the most frequent causes of delays during the legal transfer of property. Searches are unlikely to be the root cause of slowing down conveyancing in Melbourne.
How does conveyancing in Melbourne differ for newly converted properties?
Most buyers of new build premises in Melbourne contact us having been asked by the builder to exchange contracts and commit to the purchase even before the property is ready to move into. This is because builders in Melbourne tend to acquire the site, plan the estate and want to get the plots sold off as they are building the properties. Buyers, therefore, will have to exchange contracts without actually seeing the house they are buying. To reduce the chances of losing the property, buyers should instruct property lawyers as soon as the property is reserved and mortgage applications should be submitted quickly. Due to the fact that it could be several months and even years between exchange of contracts and completion, the mortgage offer may need to be extended. It would be wise to use a lawyer who specialises in new build conveyancing especially if they are accustomed to new build conveyancing in Melbourne or who has acted in the same development.