5 Common Pitfalls In Property Transactions (And How To Avoid Them)
- RHC Solicitors
- 13 minutes ago
- 5 min read
Whether you're buying your first home or selling an investment property, the conveyancing process can feel like a complex maze of legal documents, deadlines and fine print written in another language.
Over our 40+ years of service throughout Queensland, we’ve seen how small oversights can lead to costly delays, lost properties and extensive (and expensive) litigation. Here are five of the most common pitfalls we see property transactions, and how to avoid them.
In This Article:
1. Missing Critical Dates
In Queensland, standard form REIQ and ADL contracts often contain time-sensitive deadlines for conditions such as finance approval, building and pest inspections, deposits payable, and settlement.
As the buyer, you must provide notice to the seller by 5:00PM on the due date. Missing a deadline, even by a minute, can result in the other party validly terminating the contract. This is why it is critical your lawyer is notifying you of upcoming due dates throughout your matter, and speaking with you regularly.
How To Avoid:
Engage a solicitor early and ensure you are noting all due dates. At RHC, we keep you informed at every step so nothing slips through the cracks.
Remain contactable throughout the day a critical date falls due (in case of any negotiations, disputes or changes.
Provide your instructions before 5:00PM to ensure your rights and obligations are being protected and met.
2. Unclear Or Poorly Worded Special Conditions
Inserting special conditions to a contract, such as requests for early access, due diligence or specific repairs, is common. But vague or ambiguous wording can create often confusion or legal risk later on.
Whilst we understand the importance of real estate agents, it's important to remember that they are often not lawyers, and do not understand the legal meaning and affect of specific words and phrases. A good real estate agent will liaise with a lawyer to ensure any special condition is drafted correctly.
Further, the standard REIQ contract terms may look straightforward, but it contains legal terms and conditions that can significantly impact your rights if not carefully reviewed.
How To Avoid It:
Do not sign a contract (despite pressure from an agent or seller) until you are ready
Have all special conditions professionally drafted by a solicitor.
Get a contract review before signing to ensure it is in your best interests.
3. Not Undertaking Searches
Searches are an important part of the conveyancing process, revealing critical information about the property that isn't always obvious. Common searches in Queensland include title searches, rates and water, and building and pest inspections.
Where you hold concerns for any aspect of a property, such as flooding, building approval, vegetation limitations, future council developments or more, you should always undertake further searches and enquiries to ensure you are satisfied.
While there is a cost involved in ordering searches, the potential risk of not obtaining them far outweighs the upfront expense. Skipping searches may save money in the short term, but it can lead to serious issues down the track, such as discovering the property is flood-prone, has an illegal structure, or is subject to future development restrictions. These are the kinds of surprises that can turn a dream purchase into a legal and financial nightmare.
How To Avoid It:
Include Building and Pest inspections in your contract.
If purchasing vacant land, consider obtaining a contaminated land and soil test.
Include a due diligence special condition, and undertake any and all searches you need in order to be satisfied with the property.
Speak with your lawyer or conveyancer throughout the process to ensure you can exercise any rights you may have.
4. Finance Falling Through
Finance is one of the most common reasons property contracts collapse, often catching buyers off guard despite their best intentions.
Even with a pre-approval from a lender, a finance application can fall through due to changing lending criteria, valuation issues or changes to your personal circumstances, and leaves the buyer with few options.
We've written before about the importance of finance conditions, and recommend reading our in-depth breakdown of an REIQ finance condition here to learn more.
How To Avoid It:
We always recommend that unless you have an unconditional finance approval that does not lapse before the settlement date, you should never satisfy or waive the finance condition.
Always remain in contact with your lender to ensure you are attending to their requirements to avoid delays.
Ensure you are satisfied with the terms if an unconditional finance approval before satisfying the finance condition.
5. Overlooking Settlement Day
Settlement Day is the final milestone in your property transaction, yet many clients underestimate how much needs to be organised in the lead-up to ensure everything runs smoothly.
It’s not only about picking up the keys, it’s the legal moment ownership of the property formally transfers from the seller to the buyer, and when the balance purchase price is paid.
In Queensland, settlements are now typically completed electronically through platforms like PEXA. While this has streamlined the process, it also means all documents, financial arrangements, and lender approvals must be finalised ahead of time.
To avoid last-minute complications, it’s essential that:
your solicitor has received all necessary funds from you or your lender
all conditions of the contract (like finance and inspections) have been satisfied (see above)
adjustments for council rates, water and other outgoings have been properly calculated
you’ve performed a pre-settlement inspection (if applicable)
It is crucial that, for whatever reason, you are easily contactable on the settlement day to obtain instructions, notify you of any delays or changes, and notify once everything has settled.
When clients overlook the importance of Settlement and do not cooperate, they risk costly delays, default interest charges, and in more serious disputes, termination of the contract, loss of deposit or further litigation.
How To Avoid It
Let your legal team manage the preparation and communication between parties
Provide authority for your lawyer to speak with your lender
Review your settlement statement promptly to ensure you are satisfied
Perform a pre-settlement inspection to ensure you are satisfied with the condition of the property
If you're a first-time homebuyer, understanding the settlement process can be overwhelming. That's why we've put together a comprehensive article to Demystifying Property Settlement.'
Need Help With Your Property Transaction?
Buying or selling property is a major milestone, but don’t let legal pitfalls get in the way. At RHC Solicitors, our experienced conveyancing team will guide you from start to settlement with practical advice, clear communication and decades of local experience. Get in touch with our friendly and passionate property team, or get started today by getting an instant free conveyancing quote.
Disclaimer: This publication is not intended to be comprehensive, nor does it constitute legal advice. We are unable to ensure the information is current and there is no guarantee in relation to accuracy. You should seek legal or other professional advice before acting or relying on any of the content of this publication. The views and/or opinions expressed in this publication is that of the author and may not necessarily represent the views and/or opinions of RHC Solicitors.
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