Mid Mountains Legal Blog

Buying off the plan

Anthony Steel

What is buying “off the plan”?

Buying “off the plan” has advantages for the purchaser and for the developer.

A purchaser can buy a property at today’s prices which may not be completed for some time. This can be a real benefit in times of rising prices. A developer will usually be prepared to sell more cheaply where the “final product” can’t be shown to the purchaser.

Sales “off the plan” mean that purchasers are committed at an agreed price. This goes a long way towards reducing the developer’s commercial risk and is re-assuring to the developer’s financiers.

The off the plan contract

There is no standard contract for purchasing off the plan. It is important to carefully review a contract for an off the plan purchase.

What are you buying?

When you buy an existing property, there is no doubt what you are buying. When you are having a building constructed, there will usually be plans and specifications describing the property in detail.

An off the plan contract rarely has a very detailed description of the property. Usually there is just a copy of the draft strata plan or perhaps a copy of preliminary plans submitted to Council. The contract usually has brief descriptions of the type and standard of finishes to be used in the building. Make sure you are satisfied with the level of detail in the contract. The developer will usually want to retain the right to alter the plans as he thinks it desirable or necessary.


Inclusions will usually be described briefly in the contract but there will almost certainly be a clause giving the developer the right to substitute inclusions of a similar quality if the nominated products are not available.

Variations to the contract

All off the plan contracts give the developer flexibility in completing the development. For example, it may be necessary to make minor changes to the plans because of council or engineering requirements or it may be necessary to grant drainage rights or create a restriction over the whole property to comply with council requirements. There is usually a provision allowing the purchaser to pull out of the purchase if the variation significantly affects the property to their detriment. It is important to review that provision in detail to make sure you have adequate protection.

Time to complete

The contract will give the developer some flexibility regarding the time frame in which the project is to be completed. Usually, the contract provides that the developer must use reasonable or best endeavours to complete the development by a particular date, generally referred to as the ‘Sunset Date’. If the developer cannot complete by the Sunset Date (including any extensions referred to in the contract) then either party may have the right to cancel the contract. In that event, the deposit is refunded to the purchaser. It is vital to look carefully at these provisions to make sure you have adequate protection.

Entitlements of Developer over Common Property

Most off the plan contracts contain provisions designed to give the developer entitlements over the common property for a reasonable time after completion of the sale.

These clauses are often required because the developer wants to conduct selling activities on the common property or may have to do some further work on the development after settlement to comply with some statutory or contractual requirement. The Strata Schemes Management Act prohibits the developer from voting on any matter at any meeting of the Owners Corporation as your proxy or attorney regardless of whether a Contract for Sale of Land (or any ancillary document entered into by you with the developer in accordance with any Contract for Sale of Land) asserts such a right.


The contract often includes a defects liability clause. Make sure that the developer agrees to remedy any defects which appear after completion.


There is always a delay between the date of signing the contract and the completion date. Not all lenders will be prepared to give you a formal finance approval with an open ended time frame. In addition, your financial circumstances may change between the date of contract and completion. You must be satisfied that you will be able to obtain any required finance when the time comes for completion.

Transfer Duty

Normally, transfer duty (previously called stamp duty) must be paid within three months of the date of the contract. However, a transfer duty concession applies to off the plan purchases if the property will be your principal place of residence. In that event, that transfer duty can usually be paid 15 months after the date of the contract or the completion date, whichever comes first. If you are purchasing the property (including vacant land) as an investment, the transfer duty must be paid with three months of the date of the contract.

Contact us for assistance if you want to purchase an off the plan property.

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