Cooling-off period on residential property sales |
Anthony and Sally had spent several years saving money for a deposit on their first home. They spent eight months researching the market, talking to real estate agents, looking at property listings and going to open houses.
After searching for so long, the couple were becoming anxious about finding an ideal home.
Eventually, the couple found a home that was close to what they wanted. It was a bit far from Anthony´s office and didn´t have a double garage, but Sally and Anthony didn´t want to look at more houses and decided to settle for it.
They made an offer of $330 000 and asked their bank to prepare a $33 000 deposit cheque. The seller accepted their offer and returned the signed contract to them.
Sally and Anthony received the contract of sale on a Tuesday morning and handed over their deposit that afternoon.
On Thursday, a friend contacted Sally to say she had found a house that the couple might like. They arranged an inspection and decided that they liked the new property more.
Can Anthony and Sally cancel their contract of sale?
Yes. Anthony and Sally have a cooling-off period of five business days in which they can cancel the contract.
They must give the seller written notice that they are terminating the contract before 5 pm on the fifth day of the cooling-off period. The seller must return the couple´s deposit, less up to 0.25 per cent of the property´s purchase price.
Sally and Anthony´s first contract was terminated and they lost $825 of their deposit. Their offer on the second property was accepted.
Read more about buying a home and the cooling-off period.
Last reviewed 30/11/2011 |
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