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How to sell an off-the-plan property before settlement

Technically, under an off-the-plan contract, you don’t receive the title until settlement. However, once you’ve signed an unconditional contract, the property can be re-sold. Some developers won’t allow a “re-sale” prior to settlement, so it’s important to scrutinise the contract before signing if you are considering selling before you move in. It’s wise to get some legal advice as the re-sale conditions are generally buried in the fine print. The good news is there’s generally no penalty for selling before settlement. Once you’ve got the legals out of the way, selling an off-the-plan property is no different to any other real estate transaction. Some developers have experience with re-sales, or you can go down the traditional path of a real estate agent. If you do, it’s worth considering using an off-the-plan specialist. Abbott says the steps to selling include the following:

  1. Find a new buyer to sell to, as with any other real estate sale;
  2. Exchange contracts on the same basis that was entered into with the developer;
  3. At settlement, the new purchaser settles instead of the original purchaser;
  4. If the property is re-sold for a profit, the first purchaser keeps additional funds and pays capital gains;
  5. The original purchaser must still pay stamp duty.

Click link for original article from REA