Qld disclosure laws: Sellers met with heightened risk and responsibility

According to Kollosche managing director, Michael Kollosche, the changes have added increased risk and responsibility for both agents and sellers.

In particular, he said there can be very serious consequences for both parties from even minor, inadvertent, or purely technical omissions in the seller's disclosure material.

“If a prescribed certificate (i.e. a document required to be given in addition to the Form 2 Seller Disclosure Statement) is not given before the contract is entered into, that can create a termination right up to settlement, even where there is no real prejudice to the buyer,” he told SPI.

Kollosche said that, as a result, agents and sellers may be left exposed if they were under the impression there was an unbinding contract, as a technical risk still remained.

Additionally, he said the Form 2 requirements had also dragged out the transaction process, as they required sellers to gather prescribed documents before a compliant contract package could be issued.

He said delays can occur when documents are difficult to source, have expired, or need to be refreshed if the property did not sell immediately.

“This has all but removed the option for a buyer or seller to enter into a quick off-market transaction unless the purchase price exceeds $10 million, where the buyer has the ability to waive its right to receive a Seller Disclosure Statement,” he said.

Sunstate Conveyancing’s Bec Petroff said both sellers and agents now had a bigger obligation to ensure the information provided in the Form 2 was accurate, complete and supported by evidence at the time of signing.

However, she said there had been confusion around who took on the risk, with many agents incorrectly believing solicitors were responsible for ensuring the documents were correct.

She warned that cheaper Form 2 providers are cutting corners, creating inconsistency and exposing agents and sellers, while delays typically occur only when shortcuts are taken.

“Where delays occur is when agents list properties without having the Form 2 ready, or when incomplete or cheap disclosures need to be redone once a buyer is found,” she said.

Despite some complexities, she said the laws were doing what they meant to do by granting buyers greater transparency upfront and helping them make more informed decisions.

“They’re making more informed decisions before signing, which reduces disputes later,” she said.

“It also gives them confidence in what they’re purchasing – particularly around things like zoning, contamination, pool compliance, and infrastructure,” she concluded.

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