Powered by MOMENTUM MEDIA

Sun to set on development loophole

By Reporter 02 November 2015 | 1 minute read

The NSW government has confirmed that changes to development sunset clauses will be enacted within a matter of weeks.

Off-the-plan apartment buyers are set to receive improved legal protections after the NSW government announced changes to legislation today.

Under the changes, set to be introduced in parliament in the coming weeks, developers will be required to justify any sunset clause termination of an off-the-plan sale.

If a purchaser does not give their consent for the changes to go ahead, then a developer will be required to apply to the Supreme Court for leave before any termination can take effect.

The Minister for Innovation and Better Regulation, Victor Dominello, explained that the changes were in response to reports of distressed apartment buyers being stung by last-minute contract cancellations.

Advertisement
Advertisement

“The NSW government has listened to the concerns of its citizens and is taking action. We are committed to ensuring certainty in the property market and to protecting the rights of those who purchase off-the-plan properties,” Mr Dominello said.

According to the government, some consumers have reported having their contracts rescinded by a developer under current sunset clause arrangements – only to then see the land or apartment being re-sold for a greater value shortly afterwards.

Buyers with existing contracts, as well as new buyers, will be covered by the improved protections, according to Mr Dominello.

“The NSW government is putting developers on notice that from this day forward if they use a sunset clause for no other reason than to reap a windfall profit at the expense of the purchaser, then they do so at their own peril,” he said.

Read more: 

2016 growth locations revealed

Suburbs experiencing huge rental increases 

Private landlord given expensive lesson

When, not if 

Are you too old to invest in property? 

RELATED TERMS

Apartment

An apartment is a personal residence within a house or building occupied by several tenants.



Sun to set on development loophole
default
spi logo

Get the latest news & updates

Join a community of over 100,000 property investors.

Check this box to receive podcast updates

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.