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BUYING A NEWLY BUILT PROPERTY IN SA

Are you Buying an Off-the-Plan Apartment or a newly built dwelling?

Detailed below are some useful tips and information to assist you when looking at purchasing a property in these categories.

FIRST HOME OWNER GRANT

If you are a First Home Owner then you will also be eligible for the First Home Owners Grant of up to $15,000 for new residential property which of course also applies to Off the plan Apartments.

If you are a foreign purchaser looking to invest in South Australia please note that if you enter into a contract on or after 22 June 2017, you will not be eligible for any concessions or grants and may be liable for a stamp duty Foreign Ownership Surcharge of 7%.

DEFECT AND STATUTORY BUILD WARRANTY 

The builder responsible is the builder listed on the Statement of Compliance. ALL defects in the property are the builder’s responsibility to get organised to be fixed.

90 Defect Period – is through the builder and generally starts from the date the Statement of Compliance was signed and dated unless your contract states from date of settlement. The Builder must be notified of all defects before the 90 day period expires, the builder must then see to fixing the defects within a reasonable timeframe, this timeframe maybe after the 90 defect period has expired.

Statutory Warranty – 5 Year period – is through the Builder same as the 90 Defect Period.

Policy details for the Builders Indemnity insurance are listed on the Certificate. This insurance will only come into effect if the Builder disappears, becomes bankrupt or dies within five years from the date of completion.

You must put everything in writing to the Builder listing all the defects of the property, you must do this before the 90 day defect period has expired. Send it via email and post and keep a record of when it was sent, even registered post to prove that you have posted it to the Builder.

Contact CBS (Consumer Business Services) if you are having difficulties getting defects fixed through the builder. They will be able to assist you and inform you of what the process is. CBS will also be able to assist you should the Builder not see to fixing items listed as defects. CBS will also be able to inform you of what the reasonable timeframe the builder should be fixing the defects in.

NBN & GAS CONNECTIONS

NBN Connections – Is it the Purchasers responsibility to investigate and connect all utility services to the property. A Purchaser should always ask about what services will be made available to the property before signing the contract of sale. Whilst the Developer must ensure the property is ready to connect to the NBN, it is the responsibility of the Purchaser to organise the final connection. The NBN maybe ready and installed in the street outside the house. The Developer should ensure that the newly built premises has the correct cabling for NBN connection, the Purchaser will be required to organise connection from the street to the dwelling itself.

Gas Connections – A Purchaser should ensure they have discussed with the Developer early on regarding any gas connections and the process of having the property connected to gas with a new gas meter.

SETTLEMENT

Whilst the Contract of Sale may have a settlement date mentioned, it will usually have “settlement to take place within 14 days after the last special condition has been met”. Settlement for newly built dwellings are dependant of a few scenarios, all that will need to take place before settlement can occur. A few of these scenarios being;

  • Final Deposit of Plan – this is when the Vendor has finalised the land development with the Lands Title Office, which in turn creates the new Allotment you will be purchasing, and a new Certificate of Title number will be issues for your property.
  • The builder must complete building the dwelling and then must issue a “Certificate of Practical Completion (also known as Statement of Compliance or Certificate of Occupancy)
  • If borrowing funds from a bank, your bank will need to attend the property to complete their final valuation before they can formally approve your finance application.
  • If applying for FHOG (First Home Owners Grant), the Certificate of Practical Completion will need to be submitted with your FHOG application before Revenue SA will release the funds for settlement of the property.
  • As a purchaser you will also be liable to remit any GST Withholding Tax  that is required to be paid on behalf of the Vendor.  Your conveyancer will explain how this affects you and will undertake to complete all the necessary forms and payments on your behalf.

See also:       First Home Owners Grant

                    Foreign Ownership surcharge

                    GST Withholding Tax

If you want to know more drop by our office and one of our professional Adelaide Conveyancers will be able to assist you.

Katherine Long Blog Author BUYING A NEWLY BUILT PROPERTY IN SA

The team at McKay Business Services are all members of the AICSA and are proud Adelaide Conveyancers                                                                                            BrandSA  MBS Colour BUYING A NEWLY BUILT PROPERTY IN SA

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