Purchasing a property off-the-plan—before construction is complete and titles are issued—can be an exciting opportunity, but it also comes with unique legal and financial risks. At Ensure Legal, we assist buyers with navigating the complexities of off-the-plan contracts to protect your investment and peace of mind.
What Does ‘Off-the-Plan’ Mean?
Buying off-the-plan means entering into a contract before a dwelling is built or the land title has been created. Buyers often rely on architectural drawings, artist impressions, and developer promises to make their decision.f
While off-the-plan purchases can offer benefits—such as securing today’s price in a rising market—they also involve considerable risks.
Key Risks to Be Aware Of
Before committing, consider the following:
- Final product uncertainty: You won’t see the finished product until after settlement.
- Construction delays: Development timelines can change, sometimes significantly.
- Market fluctuations: Property values may rise or fall between signing and settlement.
- Cancellation clauses: Some contracts may allow developers to rescind the agreement under certain conditions.
Maintaining open communication with the developer and seeking timely legal advice can help reduce misunderstandings and disputes during the process.
The Importance of the Disclosure Statement
Queensland law requires sellers to provide a disclosure statement with key details, including:
- Seller and buyer names and addresses
- Accurate identification of the proposed lot
- Claims or representations about the future title
The disclosure must also include:
- The proposed lot number, area, and orientation
- Details about earthworks or improvements to the land
- A signed section by a cadastral surveyor outlining the expected condition of the lot at settlement
Buyers must sign and date this document to acknowledge their understanding. If you receive any updates, you should review them carefully with a solicitor.
When Is the Contract Binding?
A contract becomes legally binding when both parties sign it. However, buyers and sellers can, under limited circumstances, terminate the contract.
We strongly recommend seeking legal advice before signing or paying a deposit, as off-the-plan contracts often involve non-standard clauses that may impact your rights, settlement obligations, and financial exposure.
Cancelling the Contract Due to Material Prejudice
If a material change is made to the disclosure statement that significantly disadvantages you (legally known as material prejudice), you may be entitled to cancel the contract. This right can be exercised if:
- You are notified of a material change, and
- The change causes a serious disadvantage (e.g., smaller lot size, altered layout)
You must act either:
- Within 30 days of receiving the change notice, or
- Before title transfer
Courts consider the extent and nature of the change to determine whether it constitutes material prejudice.
Sunset Clauses: What Has Changed?
Sunset clauses allow one or both parties to terminate the contract if settlement hasn’t occurred within a specified period. These are common in off-the-plan contracts but were previously open to misuse.
New property law reforms introduced on 22 November 2023 have tightened the rules. Now, developers may only terminate under a sunset clause if:
- The buyer provides written consent;
- The Supreme Court grants an order; or
- A prescribed regulation applies.
These rules apply to all contracts entered into or still unsettled as of 22 November 2023.
Additionally, sellers cannot access your deposit early. It remains in a trust account until settlement or lawful contract finalisation.
When Can Buyers Terminate for Delayed Settlement?
Under the Land Sales Act 1984, a seller must settle within 18 months of contract signing. If the seller fails to do so (and you are not in default), you have the right to terminate the contract by giving written notice before settlement.
However, sellers cannot terminate simply due to delays unless a valid sunset clause is included in the contract and used in line with the law.
How Ensure Legal Can Help
At Ensure Legal, we guide you through every stage of your off-the-plan purchase, from contract review to disclosure analysis and legal remedies. We’ll help you:
- Understand your rights and obligations
- Identify and negotiate unfair contract terms
- Respond to delays, changes, or developer actions
- Protect your deposit and secure settlement
Whether you’re a first-time buyer or an experienced investor, our Queensland property law team ensures you’re not signing up for hidden risks
