Whether you have already decided to buy a property in Western Australia or you are interested in buying a house in WA, it is a good idea to familiarise yourself with the conveyancing process in this state. This is especially important if you are used to the conveyancing process in another state, such as NSW, VIC or QLD, as there are some critical differences of which you need to be aware.
How conveyancing works in WA
Below are the key stages of the conveyancing process that you need to be familiar with before buying a house in WA.
- Contract Review and Making an Offer – When you make an offer for a property in WA and it is accepted by the seller, a binding contract is formed. The terms will be detailed in the standard residential sales contract, which consists of two parts: a Contract for Sale and a Joint Form of General Conditions. These contracts are created by the real estate agent involved with the transaction. Although the same standard contract format is used for all residential property sales, various stipulations can be added, such as nominating a date for settlement, making the offer subject to finance being approved. You could also make your contract subject to a pest inspection or structural defect report. Because of these possible variations, you should always have your contract reviewed before making an offer. You need to be completely happy with the terms of the offer and acceptance document (which will constitute a binding contract on acceptance) before you actually make an offer.
- Finance Approval – If you are planning to make a cash offer, this step will not apply to you but if you are applying for finance to buy a property in WA, the next stage is to seek approval from your lender. You should also make sure that your lender is ready to transfer the funds at settlement. Agents in WA use PEXA to facilitate the funds transfer process: as settlement is completed electronically with PEXA, it eliminates many of the issues that may otherwise hold up the process. In fact, it is now compulsory in the state for all property transactions to be completed electronically unless it is physically impossible to do so.
- Pre-Settlement – If your finance is all in order, your settlement/conveyancing agent should now make enquiries with the Water Corporation, Office of State Revenue, local shire and strata company (if applicable). These enquiries are made in order to ascertain the status of the current property owner’s accounts and to obtain up-to-date information for all rates and fees that are payable on the property in the future. If there are any overdue accounts, these should be addressed by the seller before settlement.
Prior to settlement, you should also inspect the property again, to make sure that everything is still in the same condition as when you made your offer. If any issues were noted during the initial inspection and it was agreed that the seller would take care of them before settlement, now is the time to check that they have all been addressed.
Your settlement agent should be in contact with your lender at this point, to make sure they are ready for settlement. If you are paying in cash, you will now be asked to deposit the balance of the agreed sale price into your settlement agent’s account. This should be a trust account, to ensure your funds are safe until settlement has been completed.
- Property Inspection – Before settlement on a house in Perth, or anywhere else in WA, you should inspect the property thoroughly, or have it inspected by a qualified professional, to make sure that it is structurally sound and free from pests. You should also make sure that all fixtures and fittings are in good condition and, if not, decide what you would like to do about the issues you discover. You may, if you desire, make an offer on the property that is conditional on the issues you find being addressed by the current owner prior to settlement.
- Settlement – This is the point, as in all states and territories, at which all documentation and money is exchanged and ownership of the property passes from the seller to the buyer. When buying a house in WA, it is normal practice for your settlement agent to attend the settlement meeting in your place, and to inform you once everything has been completed. Although you will not receive all of the completed documentation from your agent or legal representative at this point, you can consider the sale to have been finalised and start making plans to move in, if you haven’t already done so.
- Post-Settlement – At this stage, you should receive a full statement of account from your settlement agent, the keys to your new property and any outstanding paperwork that has yet to be delivered, such as a copy of the Certificate of Title with your name on it. If you are planning to use the property as your main residence, you will want to take care of change of address forms at this stage and contact the local utility companies to open new accounts. We can assist you with arranging your utilities using the “Fast Connect” app.
These are the usual stages of the conveyancing process when purchasing a property in WA. However, each situation is unique, and if a specific property transaction is likely to differ from this process in any way, your settlement agent should make you aware of this in advance.
Important Differences to Note When Buying a House in WA
There are several important differences to the conveyancing process in WA, which out-of-state buyers should know about before they make an offer on a property in this state.
- No Mandatory Seller Disclosure Statement – In contrast to most states, where sellers are obliged to provide specific documents relating to their properties (in NSW for example, a copy of a recently performed title search, a copy of a registered plan, a council certificate and drainage diagrams must be provided), sellers in WA are not under any such obligation. For this reason, it is important to ask the seller any questions you may have about the property before you make an offer. You should also engage a reputable agent to look after your interests throughout the conveyancing process.
- No Cooling Off Period – If you make an offer in QLD or NSW that is accepted by the buyer, you have a cooling off period of 5 business days, during which time you may cancel the transaction without penalty. In VIC there is a similar cooling off period, for 3 business days. In WA, however, there is no such cooling off period during which buyers may change their mind without penalty. If you wish to make your offer conditional on finance approval or on certain issues with the property being attended to before ownership changes hands, you must stipulate these conditions in the offer and acceptance document.
- The Offer & Acceptance Documents Form the Contract of Sale – In most states, it is standard practice for buyers and sellers to have contracts drawn up by lawyers, which are then exchanged to complete the sale. In WA, the documents that are signed when an offer is made, with the real estate agent, constitute a binding contract. This is important to bear in mind because you will not be able to change the terms of the sale agreement after your offer has been accepted. Any special considerations or conditions that you would like to form a part of the sale agreement must be noted in the documentation that is completed at the offer stage. When you buy a house in WA, it is a good idea to make your offer conditional on all utilities – plumbing, electrical and gas – being in full working order at the appointed settlement date. Doing so will help to ensure you are not put in a situation where you have to move into a property that does not have these essential utilities connected.
Buying a house in WA is no more complicated or risky than buying a house in any other state, as long as you are fully aware of the differences in the conveyancing process. If, for example, you know that sellers are not obliged to disclose specific documentation about their properties, you can exercise due diligence before making an offer. If you are aware that an offer will become a binding contract on acceptance, you can include any desired conditions in your offer document, to avoid any misunderstanding.
Professional Assistance When Buying a House in WA
Whether you are a local buyer or from out-of-state and are looking at potential investment properties in WA, the easiest way to ensure that your property transaction is completed without a hitch is to engage the services of a professional settlement agent. As a fully licensed and experienced settlement agent, Kidman Conveyancing can provide you with the assistance you need, at competitive rates. For details of the services we provide to buyers and sellers, and to discuss your requirements, please call (08) 9521 4134, or use our contact form to send us a message.