Avoid settlement delays

AT a time when property prices are rising, buyers are reportedly getting caught out by significant changes to the practices of the Office of State Revenue when transferring land. In circumstances where sales contracts have a settlement date of three months or more after the date of the contract, the property will need to be valued by the valuer general. Those options that are entered into more than three months before the settlement date of the acquisition of the property are of particular interest to the OSR. The practice is to ensure that stamp duty is calculated on the higher sale price specified in the sales contract and the value of the property. Lavan Legal partner Peter Beekink said unless arrangements could be made with the OSR and the valuer general’s office, there could be delays in stamping the contract and transfer document, which could lead to further setbacks for a buyer and in some cases termination of a contract. “It’s really a management issue, but it could have unintended consequences for people carrying on business,” he said. “The vendor may take advantage of this situation to terminate a sale contract because there is every chance the property could resell at a better price in the current market.” While not always desirable, Mr Beekink suggested buyers should present documents at an appropriately early stage to avoid delays. A recent case caught a number of off-the-plan buyers in the Raffles complex who signed up more than two years ago and now had to pay higher penalties imposed on the increased value of the apartments.

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