Albany Prestige Realty

Forms of ownership

Where more than one person buys a property, they must elect whether to hold the land as “joint tenants” or “tenants in common”.

In a joint tenancy, each owner owns all of the property jointly with any other owner and there is one title containing the names of all owners. If one of them dies,
their interest in the property automatically passes to the other/s. Married couples often adopt this form of ownership.

In a tenants in common situation, an owner holds a set share of the whole of the property, with the remaining owner/s holding the rest of the share.
Tenants in common can sell their share or leave it to someone else in their will.

If you are considering these forms of ownership but are not sure about the differences, seek professional advice about which is better for you.

Further information: The Department of Land Information Registration Advice Line: 9273 7044.

Strata title lots

Special rules apply to strata title lots such as units and duplexes. These rules can affect your rights on the property and may lead to extra costs. Strata title properties may have common areas shared by the residents. A “strata company” made up of the owners of the individual properties controls these areas. As a strata title owner, you may need to pay a fee which is commonly called a strata management fee and paid quarterly. These fees are used to cover the costs of repair, maintenance and management associated with the common areas of the property.

Before making an offer on a strata title property, the seller, through their agent, must disclose to you all the strata title information outlined in Forms 28 and 29 as required under the Strata Titles Act 1985. This information will form part of the standard contract. If these forms are not included, the contract can be terminated even if you have already signed the O & A.

Strata title properties also have by-laws that owners (or tenants) must abide by. For instance, pets may not be permitted. A copy of the standard by-laws can be obtained from the Department of Land Information. Additional by-laws for a particular strata title property may amend standard by-laws or add new requirements. These must be registered on the Strata Plan to be legally enforceable. It is advisable to obtain and read the minutes of previous strata company meetings.

Further information: The Department of Land Information Registration Advice Line: 9273 7044.

What else do you need to consider before signing an offer?

Extensions and future plans

Pay particular attention to extensions. If extensions have been built (eg an extra bedroom, enclosed back verandah, patio, garage, swimming pool etc), make sure these have been approved by the local council. Ask the agent if he/she has checked council records to ensure that the property is approved. If the seller agrees to grant permission, you may obtain from the local council copies of any plans or permissions granted to the seller for extensions or renovations made to the property. Without the seller’s permission, the local council is unlikely to provide such information to third parties owing to privacy laws. You risk making an expensive mistake if part of the building is illegal and blocks access to sewerage drains or power lines.

If you are considering adding on rooms, subdividing, or changing the use of the property (eg from residential to office) you should check with the local council to
ensure that the Town Planning Scheme permits this to be done.

If the home has a swimming pool, check that its installation was approved by the local council and it complies with the council’s safety requirements. You should also check that the skimmer box complies with product safety requirements by phoning the Department of Consumer and Employment Protection
on 1300 30 40 54.

The local council can inform you if any changes to zoning in the immediate area are occurring which may affect the value of the property.

Home indemnity insurance

Under laws introduced in February 1997, all residential building work over $12,000 requires home indemnity insurance to protect property owners against financial loss linked with building work.

In most instances, the insurance policy must cover the construction period plus six years from the date of “practical completion”. There are special insurance
rules for owner builders who plan to sell. Ask the agent about this.

Further information: Phone the Department of Consumer and Employment Protection Advice Line on 1300 30 40 54 for the cost of a local call from anywhere in the State.

Electrical work

If the house has been re-wired, or extra lights or power points have been installed, check whether a qualified electrician carried out the work. You could ask for the name of the electrician, or whether accounts have been kept for the work done.

If you are buying a house that was built before 1960, you may want to have an independent electrical inspection done.

Further, you may have to pay higher insurance costs, or have difficulty obtaining fire cover, if the house is very old and has not been rewired. This may also affect
your ability to secure a mortgage. Check with your insurer and financial institution.

Underground power

A project to put electricity lines underground is underway in some suburbs. The State Government, Western Power and local councils are sharing the cost of moving power lines underground. The decision as to how the councils will raise their part of the funds is left up to each council. Some councils will pass the cost on to property owners.

The 2002 version of the General Conditions contains a clause which sets out who pays the costs for connecting to underground power if a property is sold. The decision is based on what stage of the project Western Power has reached by the date of the contract. The “date of the contract” means the latest date and signature (or initial) by either the buyer or the seller, that appears on the O & A.

The buyer pays if Western Power decides the property should be connected to underground power any time after the date of the contract.

The buyer also pays if, by the date of the contract, Western Power has decided that the property is to be connected to underground power and that a payment is required, but the details of cost, time and manner of payment have not been prescribed.

However, the seller is required to pay the costs of installing underground power if, before settlement, Western Power has formally set out the costs and manner of payment before the contract date. Alternatively, the seller can pay these costs to the buyer on settlement on the understanding that the payment will be made to Western Power.

The seller’s real estate agent should be able to advise of the property’s status in regards to underground power.

These types of potential future expenses should be kept in mind when negotiating the purchase price.

Contact your local council for more information.

Sewerage connection

In some areas of Perth and in country towns, land was developed without the provision of a sewerage system, and septic tanks were installed.

When sewerage connection becomes available, the homeowner is legally obliged to connect to the sewerage mains within five years. A person who purchases a property where sewerage connection is available, has 12 months to connect to the service.
Connection to the sewerage mains can cost the owner between $600 and $2,500 in plumbing costs, depending on the property. You should be aware that different versions of the General Conditions in use may deal with the issue of sewerage connection differently. The 2002 General Conditions state that if sewerage is already available to the property at the time of the contract date, the seller is obliged to pay for the full connection costs before settlement. Alternatively, the seller may pay the buyer at settlement.

If, however, a sewerage connection is not available to the property by the contract date, the 2002 General Conditions state that the buyer will be solely responsible for paying the connection costs. The buyer would still be responsible even if the Water Corporation had issued a formal written notice of connection before the contract date.

Ask the agent for a Sales Disclosure Statement. The Sales Disclosure Statement is completed by sellers and specifically outlines the property’s sewer line connection and septic tank status. It can also include other special conditions of sale.

It needs to be stated that there is no requirement for the seller to provide a Sales Disclosure Statement to a buyer. If you ask for one but are refused, you need to make your own enquiries.

Further information: Phone the Water Corporation on 13 13 95.

Decommissioning septic tanks

Under Regulation 20A of the Health Amendment Regulations 1998, after a property is connected to the sewerage mains, the owner of the premises must
“decommission” any septic tanks or other sewerage apparatus (such as leach drains).

Decommissioning means that the apparatus must be emptied in accordance with environmental guidelines. Tanks must be removed (or if this is not practicable the base broken up) and the apparatus backfilled with clean fill.

Decommissioning should occur: . no more than 60 days after a change in ownership occurs and the person who was the owner of the property at the time it was connected to the sewer ceases to be the owner; or . no more than 60 days after there is material change in the use of the premises; or . if foundations are going to be built closer than 1.2 metres to the apparatus or a building is to be constructed above the apparatus.
Since these costs could be in the order of $1,000 it is advisable to check that the septic tanks or other sewerage apparatus have been decommissioned.
Again, this can be done through the seller’s Sales Disclosure Statement. The 2002 General Conditions state that the buyer is liable for the cost of decommissioning septic tanks. Local councils are responsible for enforcing the
decommissioning legislation. Council requirements can vary throughout Western Australia.

Further information: Phone the Department of Health, Waste Water Section, on 9388 4999, or the relevant local council.

Roads and other reservations

When purchasing a house, you can request a Clause 42 Certificate from the Department for Planning and Infrastructure for about $25. This legal document
certifies whether or not a property will be affected by road reservation or public works.

Further information: Phone the Department for Planning and Infrastructure on 9264 7777. Main Roads WA or the local council may also be able to assist
regarding information about any future road projects.

Roads and rural properties

If you are considering buying a rural property ensure that you will be able to have legal access. You may also choose to have a survey carried out to check the boundaries of the property.

Further information: Phone the Department of Land Information Registration Advice Line on 9273 7044.

Tenants

Unless otherwise stated, the General Conditions require the seller to provide a vacant house when the buyer takes possession. Ask the agent if there is a lease agreement with an existing tenant. If there is and it is a fixed term lease then the tenant is entitled to stay until the lease expires. If the fixed term has expired or the tenant is on a periodic tenancy and you want to take vacant possession of the property, then the tenant must be given a minimum of 30 full days notice to leave.

If you want the tenant to stay on, you will need to amend the O & A to waive the vacant possession condition. You should also check the tenant’s rental history, amend or sign a new lease with the tenant and arrange transfer of the bond. The Bond Administrator will need to be informed as to the new arrangement (contact Consumer Protection’s Bond Administrator on 9282 0829). If the seller has engaged a property manager, there is no requirement for you to also engage the same person.You are free to select another property manager or manage the property yourself.

Further information: Phone the Department of Consumer and Employment Protection Advice Line on 1300 30 40 54 for the cost of a local call from anywhere in the State.

If you encounter problems During your search for information you may discover
problems with the property. Make sure that you resolve these before signing
the O & A.
If a problem becomes evident after you have entered into a contract, it may be possible to withhold money from settlement to fix problems on the property. Your
settlement agent or solicitor can inform you about this option. We are available

General inquiries about real estate and settlement matters can be handled by phoning the Real Estate and Settlement Advice Line on 1300 30 40 64 for the
cost of a local call from anywhere in the State. Other publications that could assist you when buying a home are:

• Buying vacant land;
• Choosing a settlement agent;
• Home buyers’ assistance fund;
• Property settlement;
• Real estate auctions;
• Real estate fees - negotiating with an agent;
• Sale by Offer and Acceptance;
• Timber pest inspections; and
• You and your property manager.

olicitors can give you legal advice about the standard contract for the sale of property.

If you are experiencing financial difficulty, places such as the Citizen’s Advice Bureau and the Law Society’s ‘Law Access’ can provide discounted legal advice. This fact sheet contains general information that was current at the time of publication. If you have specific inquiries about matters relating to your situation then you are strongly urged to seek independent professional advice.

This publication was produced by the Real Estate and Business Agents Supervisory Board with the administrative assistance of the Department of Consumer and Employment Protection. It expressly disclaims any liability arising out of a reader’s reliance on this publication.

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