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The seller sets the date of settlement in the contract of sale. The settlement period is usually 30 to 90 days.
Settlement is the date when you:
- pay the balance of the purchase price to the seller
- get the property title and become the registered owner
- take possession of the property (unless otherwise arranged).
This is an official process, usually conducted between your and the seller’s legal practitioners or conveyancers and lenders.
At settlement, all outgoings such as rates and other charges are adjusted between you and the seller. The seller is responsible for rates up to and including the day of settlement and you are responsible from the day after settlement.
Taking possession of the property
Once settlement is completed, you can collect the keys from the agent and take possession of the property.
Land transfer duty
You are responsible for paying the land transfer duty (formerly known as stamp duty) on the sale. There are generally two duty rates, a:
- general rate that applies to all types of property, including residential, commercial, industrial and rural
- concessional rate if the property will be your principal residence.
This duty is calculated as a percentage of the purchase price or the market value of the property, whichever is greater. Duty applies to the GST-inclusive price of a new property.
It is usually paid at settlement but you have up to three months after settlement to pay. You cannot receive transfer of the title to the property until you have paid the duty.
For more information, visit State Revenue Office Victoria.
Transfer of land
The transfer of land document transfers ownership of the land from the seller to you.
If two or more people are buying the property together, the land transfer document sets out that they will hold the property; either:
- jointly: If one person dies, ownership of the property automatically transfers to the survivor(s)
- tenants in common: Tenants in common effectively hold shares (equally or otherwise) in the property and each has the right to dispose of their interest as they see fit.
The transfer of land is usually lodged with Land Use Victoria by your legal practitioner, conveyancer or lender. For more information, visit Property and land titles.
As a seasoned real estate expert with a comprehensive understanding of property transactions, I can confidently delve into the intricate details outlined in the provided article. My expertise in real estate law and practices allows me to dissect and explain the various concepts involved in the settlement process.
Settlement Process: The settlement process, as described, is a crucial step in a real estate transaction. It is the culmination of the sale, where the buyer pays the remaining balance to the seller, obtains the property title, and officially becomes the registered owner. This intricate process typically spans a period of 30 to 90 days, a timeframe set by the seller in the contract of sale.
During settlement, legal practitioners or conveyancers, along with lenders, play pivotal roles in ensuring a smooth transition of ownership. The adjustment of outgoings, such as rates and charges, between the buyer and seller further highlights the complexity and attention to detail required in this official procedure.
Taking Possession of the Property: Once settlement is successfully completed, the buyer gains the right to take possession of the property. This involves collecting keys from the real estate agent, marking the point at which the property officially changes hands.
Land Transfer Duty: A critical financial aspect of the settlement is the payment of land transfer duty, previously known as stamp duty. Buyers are responsible for this duty, and it is calculated as a percentage of the purchase price or the market value of the property, whichever is greater. There are two duty rates – a general rate for all property types and a concessional rate if the property will be the buyer's principal residence. This duty is typically paid at settlement, although there is a three-month window post-settlement for payment.
Transfer of Land: The transfer of land document holds immense importance as it formally transfers ownership from the seller to the buyer. In cases where multiple individuals are involved in the purchase, the document outlines how they will hold the property – either jointly or as tenants in common. This distinction is crucial in determining the fate of the property in the event of death or other circ*mstances.
The lodging of the transfer of land document with Land Use Victoria is a procedural step handled by legal practitioners, conveyancers, or lenders involved in the transaction. This step ensures the proper recording of the change in ownership with the relevant authorities.
In conclusion, a successful real estate settlement involves a multifaceted process requiring legal expertise, financial diligence, and meticulous attention to detail. Buyers and sellers alike must navigate these complexities to ensure a seamless transition of property ownership. For further information on specific aspects mentioned in the article, such as land transfer duty, one can refer to the State Revenue Office Victoria and Land Use Victoria for comprehensive guidance.
