5 Things To Look Out for When Reviewing A Residential Contract Of Sale

5 Things To Look Out for When Reviewing A Residential Contract Of Sale


When it comes to buying a residential property in Australia, reviewing the contract of sale is a crucial step to ensure a smooth and successful transaction. Here are five key aspects to pay close attention to when reviewing a contract particularly in New South Wales.

Five Key Aspects:

1. Property Description: The contract should clearly outline the details of the property being sold. For instance, this can include the address, lot and plan number, and any specific features such as inclusions and exclusions. However, if there are any discrepancies or missing information, it is crucial to address them with the vendor (through your legal representative) before signing the contract. It is important that the property description is accurate to avoid any misunderstandings or disputes in the future.

2. Purchase Price and Deposit: Double check the purchase price stated in the contract and ensure it is accurate. Also pay attention to clause regarding the deposit, such as the amount, when it is required to be paid and whether it will be released to the vendor before settlement. Additional things to look out for are: 

a. Understand the Consequences of Default: It is important to understand the financial consequences of defaulting under the contract. Familiarise yourself with any late payment fees, interest charges, or potential legal actions that may result in you losing your deposit.

b. Keep Records of Payments: Maintain detailed records of all payments made towards the deposit, including receipts, bank statements, and any correspondence related to financial transactions. This will prevent disputes arising when calculating the funds required for settlement.

3. Title and Ownership: Verify that the vendor has the legal right to sell the property by checking the title details. This is particularly important if the vendor is not the registered proprietor, or the vendor is a corporate entity. You should also check whether there are any encumbrances, easements, covenants or restrictions that could affect your intended use of the property.

4. Special Conditions: Look out for any special conditions in the contract. The contract is a legally binding document that outlines the vendors and the purchaser’s rights and obligations. It is crucial for the clauses in the contract reflects the intentions of both parties. This could include whether the contract is subject to certain conditions being met, such as satisfactory building and pest inspections, finance approval, or specific repairs that need to be completed before settlement.

Lastly, 5. Disclosure: The contract should include a number of prescribe documents such as, title search, registered dealings, registered plans, sewerage diagram, service location prints, by-laws and council certificate. Despite all the documents in the contract, the purchaser must conduct their own enquiries and investigations to ensure the purchaser is satisfied with the property.


Therefore, as a starting point when reviewing a contract of sale, the purchaser must pay close attention to these five key elements when buying a residential property. By doing so, you can protect yourself and the other party involved in the transaction. If you have any doubts or concerns during the contract review process, it’s always recommended to seek advice from a qualified legal professional specialising in property law.

This article provides general information only and should not be construed as legal advice. The content aims to offer a broad understanding of the topic and should not be assumed to be applicable to your individual circumstances. Should you require our assistance please contact us here.