In Queensland, Buyers of all residential properties are entitled to a 5 day Cooling Off period.  The details of the Cooling Off period are contained on a document called a PAMD Form 30c which MUST to be attached to the front of a Contract and signed by the Buyer BEFORE they execute the contract.

The Cooling-Off period allows the Buyer to terminate the Contract during this time frame for any reason, provided that the termination is made in accordance with the Property Agents and Motor Dealers Act 2000.

There are some important things any Buyer, and Seller should know about the Cooling-Off period and the obligations, rights and benefits pertaining to it.

The five day cooling off period commences on the day that the Buyer is bound by the Contract.  This does not take effect until the Buyer or their Solicitor has received a copy of the Contract that has been signed by all parties.  Regardless of what time of day this occurs, that day is considered to be "Day 1" of the Cooling Off period.  The period ends at 5pm on "Day 5" of the Cooling Off period.  Days 1 – 5 must be business days.

If the buyer is bound by the Contract on a day that is not a business day, then the Cooling-Off period starts on the first business day after the Buyer becomes bound by the Contract.

The Cooling Off period can be waived or shortened by the Buyer if the Buyer chooses to do so by obtaining a PAMD Form 32a Lawyers Certificate from his/her Solicitor. 

The Cooling Off period is intended to allow the Buyer to seek independent legal advice and/or an independent valuation on the property as well as to generally ensure that they are happy with their decision to purchase the property.

If the Buyer decides to terminate the Contract pursuant to the Cooling-Off period, they Buyer must provide a signed and dated notice to the Seller.  Notice can be given at at any time prior to 5pm on the day the Cooling Off period ends.

In the event that the Buyer decides to terminate the Contract, he/she should be aware that the Seller may deduct a "termination penalty".  This penalty is equal to 0.25% of the purchase price.  For example, if you were purchasing a house for $500,000.00, then the termination penalty would be in the sum of $1,250.00.

The termination penalty is usually deducted from the deposit the Buyer has initially paid in relation to the purchase and thereafter the seller must refund the balance of the deposit within a period of 14 days from termination.

We advise Buyers to ensure that they are happy to proceed with the purchase of the property on the terms contained in the Contract of Sale prior to the expiration of the Cooling Off period.