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Section 32 Vendors Statement – why is one required when selling a property in Victoria?

Section 32 - Vendor Marketing

Selling in Victoria the disclosure information is contained in a Section 32 Vendors Statement. This is incorporated in the contract.

The legal requirement is for the Section 32 to be signed only by the Vendor, but as a matter of practice many real estate agents ask the buyer to sign it too in order to prove it was included before exchange.

A Section 32 Vendors Statement provides details of:

+  Undischarged mortgages.
+  Improvements.
+  Easements, covenants or other restrictions affecting the land.
+  Planning controls.
+  Warnings about planning controls, adjacent commercial agricultural production.
+  Rates, taxes and other outgoings.
+  Notices from statutory authorities affecting the land.
+  Utility and service connections.
+  Access to the land.
+  Insurance.
+  The body corporate if the land is subdivided.

If there is a residence on the land the Section 32 Vendors Statement must also include information about building permits and warranties. A Section 32 Vendors Statement must also be accompanied by a copy the certificate of title, proving ownership and therefore the right of the vendor to sell.

When an offer has been accepted the contracts are signed by both parties and exchanged. Some real estate agents prefer the offer to be made by actually signing a contract with the purchaser’s details and price filled in and cheque attached. It is clearly a strong approach as the offer is capable of immediate exchange. However, this ‘take it or leave it tactic is designed to preclude you from negotiating and tends to leave a nasty taste in the mouth. I recommend your real estate agent should only promote it after negotiations are at the point where you would to agree.

The cooling-off period is three clear business days. The penalty for withdrawing is 0.2% of the purchase price or $100, whichever is the greater. There is no right to a cooling-off period on the day a property is being sold at auction, nor for three days before or after. There is also no cooling-off period if the same parties have previously entered into a contract for the property in similar circumstances.

This is a clause in the standard form of contract allowing the sale to be made subject to finance if the parties agree. The purchaser must provide the name of the intended lender, the amount required and the date of expected approval. If the purchaser cannot obtain the finance by the stated date, they can rescind the contract and their deposit must be returned in full.

Although his clause is commonly used, it is dangerous from the seller’s point of view as all marketing ceases while they wait to find out whether the sale is proceeding. Even if there currently is no-one else interested, the buyer does not know that. It would seem better practice to hold off until they have their approval, and then enter into an unconditional contract.

Vendor Marketing – Melbourne’s most qualified vendor advocates specialises in both property marketing and real estate agent selection for home sellers within Melbourne, therefore we can recommend property solicitors and conveyancers to assist you with a Section 32 Vendors Statement.

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