Discussion Papers

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In December 2017, the NSW Government announced a review into off-the-plan contracts aimed at boosting existing protections for purchasers in NSW.

Separately, the Government sought feedback on reported impediments to electronic land transactions, in response to concerns and uncertainty about how digital signatures can be used on land contracts and how electronic vendor disclosure can occur.

The Office the Registrar General published two separate discussion papers in December 2017 seeking feedback on proposals to create a more transparent process for buyers off-the-plan and a more streamlined process for land transactions to be conducted electronically.

Review of residential off-the-plan contracts

The discussion paper ‘Off-the-plan contracts for residential property’ was released on 1 December 2017.

Submissions closed on 30 January 2018.

Please click on the discussion paper and submissions to view the pages.

Background

In 2015, the Government took urgent action to protect purchasers from having off-the-plan contracts rescinded by unscrupulous developers via sunset clauses, which permit rescission of a contract if registration of a plan has not taken place by a certain date. Emergency legislation tightened rules around sunset clauses and limited their use.

The number of residential properties purchased off-the-plan has risen dramatically over the last 10 years, from 2,148 in 2006/07 to 29,022 in the last financial year. These sales now make up 11.5% of all residential sales in NSW. This rise prompted a review of existing laws around off the plan contracts.

The Government sought feedback from the community and industry to identify issues currently affecting parties in off-the-plan contracts. The discussion paper canvassed a range of measures to help standardise practices within the industry and provide a better outcome for both purchasers and developers.

The paper considered possible reforms including introducing mandatory disclosure requirements, remedies in some instances where there have been changes to what has been disclosed, expanding protections relating to sunset clauses and requiring developers to provide information to buyers before settlement.

Review into reported barriers to electronic land transactions

The discussion paper ‘Removing Barriers to Electronic Land Transactions’ was released on 19 December 2017.

Submissions closed on 16 February 2018.

Please click on the discussion paper and submissions to view the pages.

Background

NSW is transitioning to a wholly electronic system for settling conveyancing matters and for the lodgment and registration of land dealings (‘eConveyancing’). However, some parts of a property transaction still rely heavily on paper, with some contracts and agreements needing ‘wet’ signatures.

The Government wants to support industry involved in the conveyancing process move into the digital environment, and has been exploring ways to overcome perceived impediments to a completely paperless process while ensuring consumers who want to sign electronically are protected.

The Office of the Registrar General released a discussion paper examining ways to harness new technology in land contracts and to enable wholly electronic property transactions. The paper looked at removing legal obstacles for digital transactions to allow contracts, deeds and land registry instruments to be signed electronically and for vendor disclosure documents to be given in electronic format.

Links and related information:

*Discussion paper: ‘Off-the-plan contracts for residential property
View the submissions received in response

*Discussion paper: ‘Removing barriers to electronic land contracts
View the submissions received in response

*Media

Off-the-plan contracts undergo review: https://www.finance.nsw.gov.au/about-us/media-releases/plan-contracts-undergo-review

Promoting technology in property transactions: https://www.finance.nsw.gov.au/about-us/media-releases/promoting-technology-property-transactions