5 Most Common Contract Conditions in NSW
When you make an offer on a property in NSW (outside of an auction), it’s common—or even essential—to attach one or more conditions (also called “special conditions”) to protect yourself. Below are five of the most common ones, with NSW-specific pointers from Fair Trading and conveyancing practices.
Quick tip: buying under auction conditions leaves no conditions — when the hammer falls, the contract is unconditional.
1. Subject to Finance / Loan Approval
- This condition makes your purchase dependent on obtaining formal finance approval by a set date.
- If the bank rejects or reduces the loan, you can rescind the contract (if the clause is properly drafted) and usually recover your deposit.
- NSW standard contracts are typically unconditional as to finance after the cooling-off period or waiver, so a simple “subject to finance” line may not be enough.
- The clause must be clear about the loan amount, timeframe, and notification process.
2. Building & Pest Inspection / Structural Condition
- You can make your offer conditional on obtaining a satisfactory building and pest inspection.
- If major issues are found (e.g. termites, leaks, foundation problems), you may renegotiate or walk away.
- Often inspections are done during the cooling-off period or before exchange.
3. Satisfactory Searches / Title, Zoning, Easements, Council Matters
- A condition that searches (title, zoning, easements, environmental) are to your satisfaction.
- Protects you from surprises like undisclosed easements or adverse zoning.
- If a search reveals a problem, you may request amendments, compensation, or termination (depending on the clause wording).
4. Sale of Buyer’s Current Property
- Makes your purchase dependent on selling your existing property.
- If your home doesn’t sell in time, you may be able to withdraw or renegotiate.
- Vendors may resist this clause as it creates uncertainty, especially in a hot market.
5. Extended / Delayed Settlement or Early Access
- Buyers sometimes request longer settlement timeframes or early access before completion.
- Could include conditions for vendors to stay on longer, or to allow early renovations.
- These need to be negotiated carefully and written into the contract.
Bonus: Cooling-Off Period
- In NSW, most private treaty sales have a 5 business day cooling-off period. Off-the-plan contracts have 10 business days.
- During this time you can withdraw, forfeiting 0.25% of the purchase price.
- Auctions have no cooling-off period, and buyers can also waive this right via a Section 66W certificate.
Things to Watch Out For
- Vendors may resist conditional contracts in competitive markets.
- Be precise with dates and notice requirements, or you may lose rights.
- Once the cooling-off period ends, the contract is unconditional, even if your conditions aren’t met.
- NSW law requires vendors to attach certain disclosure documents to contracts (title, zoning, easements, sewer diagrams).
- Poorly drafted “subject to finance” clauses may not actually protect you. Always get a solicitor or licensed conveyancer to prepare conditions.
Bottom Line
- For non-auction sales, including well-drafted conditions can be essential to protect your interests.
- At auction you have no such protection — once the hammer falls, you’re bound, no conditions attached.
- Always get professional advice from a licensed conveyancer or solicitor before signing.
Disclaimer: This information is general in nature and is not legal advice. Property contracts can be complex and each situation is unique. Always seek advice from a qualified solicitor or licensed conveyancer before entering into any contract in NSW.
