Updated 4 November 2026
What Property Buyers Need to Know About the Contract for Sale #5: How do I handle special conditions in the contract?
Have special conditions reviewed and negotiated before committing to a NSW property purchase. Confirm what each clause requires, when action is due and what happens if the requirement is not met. A requested protection only helps if it becomes part of the agreement and you comply with its requirements.
What are special conditions in a property contract?
Special conditions are additional terms tailored to a transaction. They can change standard provisions, allocate costs and risk, require particular work or make completion dependent on an event. They do not necessarily protect both parties equally, and their effect is not limited to matters that must occur before settlement.
Read them with the rest of the contract, including definitions, attachments and any clause resolving inconsistencies. The Law Society of NSW explains that sellers may propose terms favouring their interests. Ask your representative to identify deleted or amended standard provisions and explain the practical effect on your purchase.
When should you negotiate changes?
Negotiate before signing and exchanging contracts, or before bidding at auction. Tell your solicitor or licensed conveyancer which protections are essential to your decision. Requesting a change does not mean the seller has accepted it. Check that the final version contains the agreed wording before authorising the transaction to proceed.
NSW’s offer guidance explains that exchange ordinarily creates the binding sale contract. Later changes generally need agreement; you cannot impose a new finance or inspection condition unilaterally. Keep the final contract and written confirmation of amendments, rather than relying on an agent’s recollection of the negotiations.
Does a finance clause guarantee you can withdraw?
No. A finance clause provides only the protection its wording gives. Check the required approval, deadline, application obligations, evidence and notice requirements. If the seller has not agreed to finance protection, a loan refusal or insufficient lending does not automatically excuse you from completing the purchase or provide a deposit refund.
ASIC’s Moneysmart guidance confirms that pre-approval does not guarantee a loan. Discuss the required loan amount, valuation risk and outstanding lender conditions with your lender and legal representative. Have the clause address the actual funding risk, including how an unsuccessful application must be documented and what happens to the deposit if withdrawal is valid.
How should a building and pest condition work?
The clause should identify the inspections, deadline and findings that activate a remedy. It should also explain any required report, notice and opportunity for the seller to respond. A report revealing a defect does not necessarily give you a right to terminate, demand repairs or obtain a price reduction.
Compare the proposed wording with the inspection you intend to commission. NSW’s inspection guidance explains the limits of general building reports and the need for separate specialist assessments where appropriate. Allow time for follow-up investigations. Avoid accepting a narrow structural-defect trigger if your concern is something different, such as pest activity or an unapproved alteration.
What if your purchase depends on selling another property?
Tell your representative before exchange if you need sale proceeds to complete. A suitable condition should state whether you need an exchanged contract, an unconditional sale or completed settlement by a specified date. Without an agreed protection, difficulty selling your existing home does not automatically release you from the new purchase.
Clarify required selling efforts, notice requirements and what happens if the other sale fails. Ask whether the seller can continue marketing or require you to waive the condition after another offer. These are matters for negotiation, not automatic features of every NSW contract.
How should promised repairs and inclusions be recorded?
Record the actual agreement in the contract. For repairs, specify the work, required standard, responsible party, completion date and evidence of completion. Identify important inclusions clearly. Agree on inspection arrangements and the remedy for incomplete work, rather than assuming every disputed repair permits you to delay settlement or withhold money.
A promise to fix a leak may leave the method and standard uncertain. Ask for wording that addresses the identified problem and any necessary approvals. The Law Society’s guidance on inclusions recommends expressly recording doubtful items. Check that a special condition does not exclude an appliance or fixture you expected to receive.
What risks arise from early access or possession?
Inspection access and moving into the property are different arrangements. Before accepting early possession, agree on permitted use, insurance, any occupation fee, maintenance and what happens if settlement fails. Do not assume receiving keys permits renovations, storage or occupation beyond the arrangement the seller has actually authorised in writing.
The 2026 standard contract generally shifts property-damage risk to a buyer entering early possession, subject to its strata provisions. Your contract may differ. Obtain advice about the applicable risk and arrange insurance before taking possession. Confirm whether any proposed work is permitted and who bears its cost if the purchase does not complete.
Which deposit and additional-cost clauses need attention?
Check the total deposit, payment dates and whether a smaller initial payment is the whole deposit or an instalment. Review default interest, extension fees, adjustments and any requirement to release funds early. Ask for an explanation of your possible liability if completion fails; it may exceed the money already paid.
The standard contract’s deposit and default provisions show why payment deadlines matter. Early release can also prejudice recovery if the seller cannot complete. For qualifying off-the-plan contracts, deposits and instalments must be held in trust or controlled money and cannot be released to the vendor before settlement. Do not assume a proposed release clause is effective merely because it appears in the contract.
How is cooling-off different from a special condition?
Cooling-off is a separate statutory right, subject to exceptions. For ordinary NSW residential purchases, it generally ends at 5pm on the fifth business day after exchange; qualifying off-the-plan contracts usually allow ten business days. Exercising that right ordinarily costs 0.25% of the purchase price, rather than providing a full refund.
Auction purchases and contracts made on the same day as a passed-in auction have no cooling-off period. Other exclusions apply. Under sections 66S–66W of the Conveyancing Act, waiver or shortening requires the applicable certificate requirements to be met. Do not assume a written agreement alone shortens the period. The vendor can extend it in writing before expiry. Check the NSW overview with your representative.
How should you manage deadlines and notices?
Create a written timetable as soon as contracts are exchanged, identifying who must act and what evidence is required. Send reports and lender correspondence to your representative promptly. A request for more time does not itself extend a deadline. Obtain confirmation of any extension and ensure required notices are validly served.
Check whether the clause uses calendar days or business days, specifies a time and names a recipient or service method. Do not assume telling the agent satisfies a formal notice requirement. If a deadline has been missed, seek advice immediately before asserting a right to withdraw or refusing to complete.
What does a real NSW finance-clause dispute show?
In Lemongrove Services v Rilroll [2019] NSWCA 174, buyers requested finance protection, but the sellers rejected it. The NSW Court of Appeal upheld findings that the buyers had not been told of that refusal before exchange. The case demonstrates the importance of confirming that a requested condition was actually included.
The transaction involved Huntleys Cove land and a café business. After bank valuations were lower than expected, the buyers could not complete. They settled the sellers’ damages claims and pursued their legal advisers for failing to inform them that the finance clauses had been refused.
The advisers’ appeal was dismissed with costs. The Court upheld the finding that the buyers would not have exchanged had they known the clauses were absent. Although this was a commercial transaction, residential buyers can apply the practical lesson: obtain confirmation of the final terms and the consequences of any rejected amendment.
Can special conditions remove statutory protections?
Some statutory protections cannot be excluded by agreement, while others have specific waiver procedures. Do not assume every unfavourable clause is invalid, or that every printed waiver is effective. Ask your representative to identify the relevant legislation, the protection it provides and the steps required to exercise a remedy.
For example, section 66ZU(5) of the Conveyancing Act prevents contracting out of the off-the-plan safeguards in Part 4, Division 10. Cooling-off is governed separately and can be waived or shortened as described above. A clause allowing changes to a development must be assessed alongside the applicable statutory rights.
What should you confirm before proceeding?
Confirm that essential protections appear in the final contract, you can meet the deadlines and the funding arrangements suit your obligations. Identify any risks you have agreed to accept. Our practical recommendation is to resolve unclear wording before exchange, when there is still an opportunity to negotiate a workable arrangement.
For help reviewing special conditions and buying property in NSW, contact Christine Manolakos and CM Lawyers on (02) 9557 9000 or email lawyers@cmlaw.com.au.
This article provides general information about NSW property contracts. Obtain advice on your particular contract before signing, waiving rights or issuing a notice.
Key resources
NSW Government — Preparing to purchase — Contract review, deposit, settlement and special conditions.
NSW Government — Making an offer — Negotiation and exchange of contracts.
Law Society of NSW — Once you have decided to buy — Contract terms, inspections and inclusions.
ASIC Moneysmart — Buying a house — Finance preparation and the limits of pre-approval.
NSW Government — Inspection reports — Scope and specialist follow-up.
Law Society and REINSW — 2026 standard contract sample — Reference provisions; actual contracts may be amended.
NSW Government — Contracts and deposits — Exchange, deposits and cooling-off overview.
Conveyancing Act 1919 — Cooling-off rules and off-the-plan statutory protections.
NSW Government — Buying off the plan — Deposits, disclosure and development changes.
Registrar General — Guidance for practitioners — Updated prescribed cooling-off notices for contracts exchanged from 1 June 2026.
Lemongrove Services v Rilroll [2019] NSWCA 174 — Official judgment concerning the omission of requested finance clauses.
CM Lawyers — Property contract reviews and fees — Have the contract reviewed before you sign or bid.
