There's a lot that must be considered when engaging with the real estate market, and one thing that most will come across is a vendor statement.
But, do you need one, what is it, and why is it important?
The answer to the first question is ‘yes’, you do need a vendor statement. Vendor statements, also known as a section 32, are documents that tell potential buyers what they need to know about a property before signing a contract to purchase. It's a vital part of the buying and selling process and discloses all information that isn't readily available during an inspection.
The vendor statement has to cover certain information, such as:
Including written contracts giving the finance lender certain rights over the property.
An easement is a right held by one person to use another person’s land, such as for drainage and sewage. All easements must be included in a vendor statement.
A property owner may need to do something, or even refrain from doing something, before a sale. This is covered by a covenant in the vendor statement and may include information such as how many dwellings may exist on a property, or whether there are any restrictions on future renovations or developments.
Councils in certain areas will have laws dictating what they allow the land to be used for. This may put restrictions on pet ownership and could include information regarding nature developments, and address issues regarding future developments and renovations for properties in the area.
This includes whether the property is in good condition, complies with building regulations, and is accurate to the measuring on the title.
Legal claims and titles, all adverse interests such as mortgages and caveats, land tax, building permits.
Outgoings are the costs incurred by an owner while on the property – for example, rates and insurance.
This includes whether a property is in an area that is prone to bush-fires, floods, or other natural disasters.
It's important to realise that a vendor statement is a legal document and it must be factually accurate and complete to the best knowledge of all parties. All sellers must provide vendor statements to potential buyers before they sign a contract of sale.
Conveyancers are responsible for the vendor statement, and all buyers and sellers should engage with one if they wish to avoid the legal ramifications of real estate.
If a vendor statement is incorrect or incomplete, a buyer can terminate their contract of sale. It's recommended that sellers do their due diligence when it comes to this document, and we can help. At Place Estate Agents, we’re specialists in buying and selling. Our team can help you get the right papers in the right place - so you can settle into your Place with confidence. Get in touch today.