Understanding the Legal Side of Selling Your Property Privately

Selling a home privately offers flexibility, control, and cost savings, but legal compliance is essential to ensure a secure and hassle-free transaction. Whether you're selling independently or through an agent, Australian property laws regulate contracts, deposit handling, and settlement procedures.

Here’s everything you need to know about the legal requirements for selling privately and how to navigate the conveyancing process like a pro.

What is Conveyancing?

Conveyancing is the legal process of transferring ownership of property from the seller to the buyer. It ensures that the transaction follows State-specific regulations and includes:

Preparing contracts with mandatory disclosures.
Handling deposit payments securely.
Ensuring compliance with property laws and tax requirements.
Managing settlement procedures for a smooth transfer of ownership.

Sellers should engage a licensed conveyancer or solicitor to ensure all legal documents are properly drafted and compliant with State regulations.

Essential Legal Documents for Selling Privately

1. Contract of Sale

The Contract of Sale is the most critical document in a property transaction, outlining the agreed terms between the buyer and seller. It includes:

Buyer & seller details (names, contact information).
Property address & title details.
Final sale price and deposit amount.
Settlement period and transfer timeline.
Included fixtures, fittings, or additional items.
Special conditions, such as "subject to finance" clauses.

Without a properly drafted Contract of Sale, the transaction cannot be legally finalized.

2. Vendor’s Statement

The Vendor’s Statement, also known as the Section 32 Statement in Victoria, discloses key details about the property to the buyer, including:

Council rates and zoning information.
Water, gas, and electricity connections.
Outstanding land tax or debts linked to the property.

Disclosure requirements differ by State, with Victoria and NSW requiring more detailed reports, while Queensland and WA place greater responsibility on buyers to conduct independent research.

State-Specific Legal Requirements

Each Australian State has unique laws governing real estate transactions. Key differences include:

NSW & ACT: Sellers must have a Contract of Sale before listing their property—failure to do so breaches State law.
Victoria: A Section 32 Vendor Statement is required before signing agreements. An SOI (Statement of Information) must be provided for pricing comparisons.
Queensland, WA, SA, TAS, NT: While contracts must be finalized before settlement, sellers do not need contracts pre-listing but should prepare them in advance.

Confirm your State's legal obligations before listing a property privately.

Holding & Managing the Property Deposit

Who Holds the Deposit?

Upon signing a Contract of Sale, buyers must pay a deposit, usually 10% of the sale price, unless a different amount is negotiated.

How Deposits Are Managed Securely

Deposits must be held in a solicitor or conveyancer’s trust account until settlement.
Sellers cannot hold deposit funds in personal or business accounts—it is illegal to do so.
The funds are released to the seller upon final settlement of the sale.

Secure deposit management protects both the seller and buyer from disputes.

What Happens After Signing? The Settlement Process

Key Post-Contract Legal Steps

Once the Contract of Sale is signed, the sale moves into the settlement phase, which includes:

Transfer of Land Documentation – Officially updates government records with new ownership details.
Stamp Duty Payment – Buyers must settle stamp duty before the transfer can be completed.
Capital Gains Tax Withholding – Sellers must lodge tax declarations if the sale price exceeds $750,000.
Verification of Identity – Confirms both buyer and seller are authorized to execute the transaction.
Property Rate Adjustments – Ensures all outstanding council and utility payments are settled before handover.

Settlement usually takes 30–90 days, depending on State regulations and buyer-seller agreements.

Why You Should Seek Legal Assistance

Even if selling privately, legal support is highly recommended.

Benefits of Using a Conveyancer or Solicitor:

✅ Ensures compliance with State property laws. ✅ Prepares legally sound contracts to prevent disputes. ✅ Handles settlement documentation for a seamless transaction. ✅ Protects both parties by overseeing financial and contractual obligations.

The buyer should also engage legal assistance, ensuring fair negotiations and compliance.

When Should You Have a Contract Ready?

Before Listing Your Property

Mandatory in NSW & ACT—sellers must have a Contract of Sale before listing their home.

Before Hosting Open Homes

Even in States where pre-listing contracts are not required, having documents prepared before open inspections prevents delays in accepting offers.

Avoid Using Old Contracts

Each property sale is unique, and outdated contracts can result in legal challenges—new contracts should always be prepared for each sale.

Final Thoughts

Selling your home privately gives more control, eliminates agent commissions, and allows direct negotiations—but legal compliance is essential to ensure a smooth and valid property transfer.

By preparing a legally sound Contract of Sale, disclosing accurate property details, and ensuring secure deposit handling, sellers can confidently navigate the legal complexities of real estate transactions.

For expert conveyancing support, always consult a licensed solicitor or conveyancer to ensure that your private sale follows all legal requirements.