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Frequently Asked QuestionsWhy use a
Conveyancer? Do Conveyancers need to be Licensed?As of 1 July 2008, any person practicing as a Conveyancer in Victoria, who is not an Australian Legal Practitioner, must be licensed to continue to conduct Conveyancing work. In introducing the legislation the Government was also concerned to address other problem areas such as inadequate professional indemnity insurance, lack of experience and expertise, lack of any professional conduct rules and the absence of any requirement to make proper disclosure to the client of the costs likely to be involved in the transaction.
Do Conveyancers have Trust Accounts?Under the Conveyancers Act 2006 Licensed Conveyancers can hold in a general trust account which is designed to only be used for the purpose of holding money received from a client in the course of or in connection with the carrying out of Conveyancing work on behalf of that client. Trust money in the form of money you receive from clients on account of fees and charges in advance of carrying out Conveyancing work must also be held in a general trust account until such time at their Conveyance is complete.
Part 5 of the Act and Part 3 of the Conveyancers (Professional Conduct and Trust Account) Regulations prescribe strict processes for dealing with any trust monies received. If I have an investment property can I claim Depreciation and How?If you have an investment property, it can be depreciated. Think of it as ‘wear and tear’. Houses, units and commercial properties all qualify. Even older properties can be depreciated. 81% of Australian property investors are not claiming their full tax deductions! By using an ATO recognised Tax Depreciation Schedule, investors can claim thousands of legitimate tax dollars back on their investments, conserving their cash flow and safeguarding their future. Schedules can even be backdated so investors can claim up to 4 years of ‘lost’ depreciation! How much money can you claim? How much you can claim as a tax deduction depends on your individual tax situation. Doesn't depreciation only apply to new buildings? Any building where construction started after 18 July 1985 qualifies for the 'Special Building Write-Off'. That means you can depreciate the original cost of construction. Plus, for all buildings, there are a host of depreciable assets like hot water systems, blinds, floor coverings and stoves that may be depreciated. Can renovations be depreciated? Yes. The 'Special Building Write-Off' can be claimed as long as the renovations were undertaken after 26 February 1992. Investors can also claim Architects and Engineers Fees. Structural inclusions such as retaining walls and sealed driveways, if undertaken after this date, can also qualify. Balben Property Transfers recommends that you take advantage by using a Tax Depreciation Schedule to help you maximise your Tax Depreciation. Please note that we recommend Depreciator to you on an independent basis and we do not receive commission or other benefits from Depreciator. Depreciator has an Australia wide network of Quantity Surveyors and appropriately qualified people. They supply Tax Depreciation Schedules to one of Australia’s largest accounting groups and two of Australia’s largest real estate groups. Their service is cost effective and efficient. What are the benefits of using Depreciator?
Who is Depreciator? Depreciator is a Quantity Surveying company whose sole focus is the preparation of Tax Depreciation Schedules for individual investors. They cover all capital cities and many regional areas. Their specialist skills ensure that clients receive the maximum depreciation allowable on their investment properties. For further details on Depreciation Schedules, please visit Depreciators website at www.depreciator.com.au
What are Disbursements?Disbursements include any monies that are paid out by Balben Property Transfers in connection with the selling or purchasing of a property. They comprise many things, such as: Title Searches, Certificate Enquiries, Section 27, Form 3’s and 4’s, Licence Agreements, Lodgement of Documents, Photocopying and any other work which may be required. The amount of these Disbursements will vary depending on whether you are selling or purchasing a property.
What are Adjustments?Rate Adjustments relate to the transferring of rates paid or unpaid until settlement to the appropriate people. This means that all rates and taxes on the property will be split between the vendor and the purchaser pursuant to the date of settlement. The vendor will be required to pay all monies due on the property until settlement, and the purchaser will pay all monies from the date of settlement and onward. The amount of adjustments owing by each party will therefore depend on the time of year in which the property is sold.
What is Finance Approval?In many cases when purchasing a property, the purchaser will not yet have the appropriate funds to pay for the property at the time when the contracts are signed. This does not mean, however, that the contract cannot go ahead as planned, but merely that an extra clause pertaining to finance approval should be written into the contract. This clause for finance approval basically means that the sale will go ahead as long as the purchaser obtains the finance to do so within the allotted time, usually within 30 days; however the amount of time given is purely up to the parties involved. If the purchaser does not manage to get their finance approved within the given time, then the contract is annulled.
When is payment due for Stamp Duty and Registration fees?If you are intending to purchase a property through the use of finance from a bank or other lending institution, then the payment of Stamp Duty and Registration fees will generally be advanced by your chosen lending institution, be it bank or other, at settlement. If you are providing the funds yourself then Balben Property Transfers will need to attend the Stamping and Lodging of the documents within 90 days of settlement, or penalties apply.
Do I qualify for Stamp Duty Benefits?Whether or not a purchaser qualifies for Stamp Duty Benefits, or even complete exemption, depends on the conditions of the purchase. You may qualify for Stamp Duty Benefits if you are a First Home Buyer with a family, or a Concession Card holder. Any benefits you may qualify for also depends on the value of the purchased property. To check if you qualify for any Stamp Duty Benefits, you can contact Balben Property Transfers or the State Revenue Office.
What is Settlement?Settlement refers to the date upon which the transferral of all monies and documents pertaining to the property are transferred, including the title and thus the ownership of the property to that of the purchaser.
Do I have to attend settlement?The settlement date is agreed upon by all parties involved, and the time of settlement will usually be stipulated in the Contract of Sale. Neither vendors nor purchasers need attend the actual settlement itself, as that will be attended to by their conveyancers and a representative of their bank or other lending institution. The vendors and purchasers will be informed once settlement has occurred.
Where and when do I get the keys?In most cases the agent responsible for selling the property will keep the keys, and will pass them onto the purchaser once settlement has occurred and have been notified as such by the vendor’s representative.
What is Old Law?The transferring of land is now governed by what is known as the: Torrens System. But properties which have not been bought or sold within the time when the Torrens System began, will find themselves with Old Law Titles. Any property still under Old Law is required to be converted to the Torrens System when transferred, sub-divided, or even re-financed in many cases, and here at Balben Property Transfers, we can do that for you.
What are Covenants and Easements?A covenant is contractual agreement, creating an obligation to the proprietor of the land to which the covenant is attached, and is passed down with the property when transferred. They are used, in most cases, to preserve rights and regulate standards outside the range of easements (see below) and can be either positive or negative to the proprietor. Covenants can include many different things, such as: the minimum floor size that a house is allowed to be, the materials used to build, or even the use of the particular objects on the property like business signs, etc. An easement is an interest in land that allows a person to have beneficial use of another’s land for a specific reason. It is therefore a restriction on the land over which the easement is held. Easements come in many forms and property related services, but some of the most common in residential areas are sewer and drainage issues, and the combined use of a single driveway for two adjoining properties. Some easements provide the right of passage for another over the other’s property. Some easements require maintenance, meaning that to ensure that the easement still applies, it must be used; such with the right of passage: if that passage becomes unused, then that easement may be lost in time. The particulars of an easement will be stipulated in the title of the land to which the easement applies. Purchasers should also note that there may be unregistered easements such as sewers, drains, water pipes, gas pipes (if applicable), and underground and/or overhead cables.
What are Caveats?A caveat is a document lodged at the Land Titles Office to protect the rights of a person who claims to have an interest in the land. The caveat itself does not create anything, nor does it initiate any rights not already in existence. It does however act as an injunction, restraining the Registrar of Titles from registering any dealings with the property without first notifying the caveator. There can be caveats over land without the knowledge of the proprietor, and may only be discovered once proceedings for the transfer of the land have begun. The finding of a caveat can often lead to delays up to 90 days or more between the time of signing the contract until settlement is achieved. Any person claiming an interest in land is entitled to lodge a caveat on title, but cannot be lodged if no legitimate interest exists. Caveats can be removed through withdrawal by the caveator in an appropriate and approved form.
What is Common Property?Common Property refers to the land which can be accessed by all others living under the one strata title or body corporate or all others living within the same block of flats, units, or apartment. The common property will usually include such things as car parking areas, court yards, grassed areas outside or stairways. The common property is the responsibility of all those who have claim to it; so when repairs or maintenance is required, the costs will be borne by all. Any land which contains common property must take out public liability insurance and reinstatement and replacement insurance for all buildings on each lot. In the case of a body corporate, a minimum of $10,000,000 for public liability insurance must be paid.
What is an Owners Corporation?An Owners Corporation is responsible for managing any common property which exists between two or more properties. Whenever a plan of subdivision creates common property, an Owners Corporation is responsible for managing that common property. A purchaser of a lot that is part of an Owners Corporation automatically becomes a member of the Owners Corporation when the transfer of that lot to the purchaser has been registered with Land Victoria. How are decisions made by an Owners Corporation?As an owner, you will be required to make financial contributions to the Owners Corporation, in particular for the repair, maintenance and management of the common property. Decisions as to the management of this common property will be the subject of collective decision making. Decisions as to these financial contributions, which may involve significant expenditure, will be decided by a vote. Owners Corporation rules You should look at the Owners Corporation rules to consider any restrictions imposed by the rules.
Lot entitlement and lot liability Lot entitlement is an owner’s share of ownership of the common property, which determines voting rights. You should make sure that the allocation of lot liability and entitlement for the lot you are considering buying seems fair and reasonable. Management of an Owners Corporation IF YOU ARE UNCERTAIN ABOUT ANY ASPECT OF THE OWNERS CORPORATION OR THE DOCUMENTS YOU HAVE RECEIVED FROM THE OWNERS CORPORATION, YOU SHOULD SEEK EXPERT ADVICE. New Building Works including Owner-Builder Works.Vendors are required to give details of any building approvals, permits and insurance (if applicable) issued in the last seven (7) years. In some circumstances, where building works have been carried out by an owner-builder, it is necessary for an owner-builder to give details and ensure that a condition report giving details of any relevant building defects, and certificate of insurance (insurance is only required where the value of the building work is more than $12,000.00), should all be included in the Vendors Statement as required under the Building Act 1993 and that the section 137C certain warranties are required to be put into the Contract of Sale if you are an owner-builder. Swimming pools, Spas and other bodies of water.Under the Building Regulations all new and existing swimming pools, spas or other bodies of water of more than 300mm in depth (including those constructed prior to 8 April 1991) must have gates and doors installed with self closing and self latching devices (located at least 1.5m above ground level) that returns the door or gate to its closed and locked position at any point from a stationary start as failure to do so may incur a fine. Further information can be obtained from your local council.
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Copyright © 2003 Balben Property Transfers of Ballarat,
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