It’s a well-known fact that buying and selling property can be an expensive ordeal, and not an undertaking venture that should to be taken on a whim. There are several parts of the process that need to be followed in order to ensure a smooth, stress free settlement – including conveyancing.
Conveyancing is a highly important aspect of the process of transacting a property, whether you’re buying or selling. It can be difficult to know how to choose a good conveyancer, which is why it’s important to consider the experience and reputation of any potential company you engage.
Many property buyers and sellers find that it can be hard to find the middle ground between great service and an effective cost price, without compromising quality. Given the large expenses involved, it’s common to want to cut prices where you can. But how can you be sure that your cut-price service hasn’t cut corners too?
Here’s our guide to getting a professional conveyancing service at a reasonable price, including how to tell if you’re being ripped off – and the best ways to avoid any nasty hidden charges.
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Types Of Conveyancer Costs
Depending on the conveyancer, some may charge a flat fee, while others operate under a sliding fee structure, depending on the property’s sale price.
The most common cost structure is for conveyancers to provide their services for a fixed fee (plus searches). The amount will vary depending on the property, the conveyancer and the complexity of the transaction; when you’re requesting for a quote, your conveyancer will ask for more information so they can provide more accurate estimates of the costs involved.
A flat (or fixed) fee for a seller will usually include things like negotiation, preparation and review of the contract, reviewing requisitions and responding to them accordingly, attending the signing of transfer papers and, if necessary, communicating with the mortgagee prior to settlement. It also may include search and filing fees, as well as the calculation of taxes and rates.
A sliding fee structure is much more varied and is dependant on the end sale price of the property. It may also include additional charges for things like photocopying, phone calls and other ad hoc expenditures, as they haven’t been accounted for under the fixed fee structure.
With a sliding fee structure, if anything further is required and it falls outside the usual conveyancing scope of works, it will generally be charged as per the Standard Costs Disclosure Form for conveyancing.
Either way, whether you’re to be charged on a fixed or sliding fee, you can and should request this information in a quote when you first enquire.
To avoid being blindsided by an unexpectedly high conveyancing bill, it’s advisable to ask for a written and detailed quote prior to engaging services.
The cheapest quote is often not the best one, as it’s important to engage with a conveyancer who can provide you with the level of service and protection you need.
When you’re evaluating quotes, also keep in mind that a number of factors can affect conveyancing costs, such as the scope of work and searches. Generally, a conveyancer will take into account things like the approximate amount of time it will take to manage your file, any out of pocket expenses that might be required, government fees, and the potential for any issues that may arise, which will incur additional time and, subsequently, a higher cost.
Scope Of Conveyancing
One of the services that all conveyancers should offer is reviewing your contract, which enables you to know if there are any risks associated to your purchase. The review phase is also a good opportunity to bring forward some of your own conditions (better if recommended by your conveyancer) to the table.
It can not be stressed enough how important a review is. You’d be surprised how many people think they have found their dream home and go ahead and sign the contract, without properly checking its contents. They then end up finding out there are extensive (and expensive) issues after the fact.
From a buyer’s perspective, conveyancers should research the property, particularly the title, council rates, and land tax, to ensure that you don’t inherit any of the seller’s debts. These are known as “disbursements” and it’s your conveyancer’s job to ensure any disbursements are accurately calculated. For instance, if you’ve paid council rates until November 15 and your property settles on August 23, your conveyancer will ensure that the over-payment between August and November is refunded in your favour.
Just as importantly, they’ll make sure there is no third-party preventing you from becoming the new property owner. This can and does happen, which is why it’s crucial to have an experience conveyancer on your team.
Other services that your conveyancer might offer include contacting your lender to confirm if your finances are in order; advising you of your stamp duty payable and your eligibility to stamp duty concessions or exemptions; preparing all the necessary transfer of property; and lodging a Caveat – that is, registering your name as a Caveat or on title to secure the property by preventing any other dealings from being registered on the title before settlement.
When it comes to conveyancing, the main goal is to find something that will work for you as your advocate for the best possible result. This means that while price is a concern, you don’t want to go overly cheap, particularly when you are buying property. The process of buying a home will quite possibly be your biggest purchase to date, and you will be buying something worth hundreds of thousands or even millions of dollars – so it makes sense to prioritise quality service and advice first and foremost.
What Are Searches And Why Do You Need Them?
Searches are the charges incurred by your conveyancer from third-party services on your behalf. Some conveyancers will provide an exact figure for their quote regarding the cost of such searches, while others will provide a range, as it can be difficult to estimate the exact amount beforehand.
Examples of searches include title searches, stamp duty, land tax, inspection fees, loan fees, building insurance, council rates, water rates and strata levies.
Costs like building certificates, land tax certificates, and government fees to the Environmental Protection Authority and Roads and Traffic Authority usually have fee ranges as well.
Several of these searches are generally required to be completed by yourself, meaning the cost will be incurred regardless; engaging a conveyancer means that they are doing the labour for you and preparing any adjustments that need to be made.
What If You’ve Been Quoted A High Fee?
When getting quotes for your conveyancing fees, some of the price estimates you receive might seem quite high. Keep in mind that it’s always better to have a slight overestimate beforehand, instead of a higher invoice and a nasty shock afterwards.
However, if you’ve been quoted with an unusually high figure, this could be because there are complicated contract clauses and other issues for your conveyancer to navigate. In this instance, it’s best to query it with the conveyancer so you are fully aware of what the potential complications and issues are.
If it is a straightforward transaction, however, and you feel the quote you’ve received is high, then you may want to shop around. Just remember, although the cheapest price may not always be the best service (as a general rule of thumb, you will get what you pay for), some conveyancers will charge well about the market rate, so it can pay to shop around.
Furthermore, if you’ve requested a quote from a conveyancer and you’ve found they have gone ahead and begun work before providing you with that finalised and accepted quote, you are within your rights to have them cease activity until you approve the written quote. Australian Consumer Law dictates that accepting a quote is entering into a contract with the business for their supply of goods and/or services, and that any charges must be fair and reasonable within industry standards. As such, you can claim that because work began before you accepted a written quote, no contract exists between the conveyancer and yourself, and you are still free and able to seek out other quotes before proceeding with work.
Difference Between Buying And Selling
A conveyancer is not a mandatory part of buying or selling a property, but it’s definitely an advisable expense. Essentially, they’re there to assist with the property transfer, and, whether you’re buying or selling, they are extremely helpful and beneficial to your end result. But what’s the difference in conveyancing for buyers, and sellers?
For someone selling their property, a conveyancer will prepare the Contract of Sale, including any particular conditions that may be required, with the aim to protect the seller from any conflict or dispute further on.
They’ll also prepare the Vendor’s Statement (which is also known as a Section 32), which is a document providing any potential buyers about the property title and anything else they should be aware of prior to signing the purchasing contract.
While the seller is the party with the legal responsibility regarding their Vendor’s Statement, these are usually drawn up by the conveyancer and generally cover things like mortgages, covenants, council zoning and easements. Your conveyancer will ensure that all the proper title and planning searches have been done, and any disclosure obligations will be met in accordance with the relevant state or territory laws.
What’s more, they will also assist in including any particular conditions required in the Contract of Sale, as this can vary between every property sale. As an example of a particular condition, if you’re buying and selling at the same time, the conveyancer can arrange the settlement dates to coincide with the purchase date of another property.
If you’re buying a property, a conveyancer will prepare the documentation required to complete the transfer. This makes sure the property is legally and rightfully transferred to the correct owner, under the correct stipulations. They’ll also provide legal advice regarding any terms and conditions in the sale contract.
This is an invaluable assist to those who aren’t too savvy when it comes to deciphering legal contracts, and it can help you avoid signing a contract that is incorrect or unfair. They’ll help recognise any potential planning restrictions and other notable additions to the property.
The conveyancer tends to not be directly involved with the end financial arrangements, but they can assist in facilitating the preparation by ensuring the bank receives all the crucial title details, as well as helping them organise the mortgage documents as necessary. They’ll further liaise with the bank to make sure your funds are present and correct to pay all the fees involved.
During the end process of settlement, your conveyancer will also help ensure you’re paying any property costs gained from the date of settlement, so you can avoid having to pay for expenses that occurred prior to purchase, like any council and water rates.
Average Conveyancing Costs And Fees
Though costs for conveyancing will always vary, a rough estimate can be garnered from the below tables.
As an example, here are the average conveyancing fees when buying an existing house in Australia:
If you are looking to understand the price breakdown for vendors, the average conveyancing fees when selling a property an existing house in Australia is as follows:
|Location||Fixed Professional Legal Fee||Standard Searches||Average Total Estimate|
|QLD Brisbane||$450 to $550||$18 to $30||$468 to $580|
|VIC Melbourne||$700 to $850||$350 to $400||$1050 to $1250|
|NSW Sydney||$750 to $850||$300 to $350||$1050 to $1200|
|TAS Hobart||$700 to $800||$300 to $350||$1000 to $1150|
Even though a conveyancer is not a compulsory professional that you must engage when purchasing or selling a property, buyers and sellers will often find the process complicated and arduous, without the additional help.
By utilising the services of a professional conveyancer, you can streamline the proceedings and most importantly, avoid making any costly mistakes that create headaches and potential financial miscalculations. A qualified and experienced conveyancer can be your best defence against a stressful property buying or selling experience.