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Nobody wants to move into a brand-new home with its previous tenants still in it. While handing over an empty property seems intuitive, many will overlook chattels such as furniture or moving boxes. If a seller is offloading a property, they must stipulate this in their contract. Whether buying or selling, getting to know the implications of vacant possession can reduce the risk of misunderstandings.

The Basics of Vacant Possession

At the very least, sellers offering vacant possession must ensure that the property becomes available to the buyer upon completion of the sale. This implies that the new tenants must be able to occupy the space physically.

What defines vacant possession will depend on the unique buyer-seller circumstances. A seller, for instance, might be aware of the presence of illegal squatters or leave something behind that interferes with the functionality of the new asset.

Thus, sellers should always identify what they consider to be vacant possession. During this consideration, they must also ensure that they meet the conditions listed in the sale contract. To prevent legal disputes, buyers should visit the property before closing the sale.

If you come across an online listing that states a property is “available with vacant possession” or provides “vacant possession upon completion” it assures you that its seller is contractually obliged to rid the property of tenants or personal effects upon your move-in date.

The Implications of Tenants in a Sold Property

Despite how absurd it may sound, buying or selling a property occupied by existing tenants isn’t out of the ordinary. However, it will differ from the process of a typical transfer of ownership.

In this case, the seller must disclose any vital information regarding the tenancy. Should the buyer be satisfied with the conditions, they simply inherit the role of the landlord within the tenancy agreement.

What Are Essential Considerations?

Any conveyancing solicitor acting on behalf of the buyer or seller will not visit the property themselves. As such, either party should take matters into their own hands and communicate to lawyers any concerns before the contract becomes legally binding.

After this date, both parties must execute terms as stated on the contract. If either party fails to meet the terms of sale, legal consequences can become costly and devastating.

If the contract is exchanged between parties and doesn’t list an agreement for the removal of items, the buyer can no longer enforce removal legally. Thus, they will have to shoulder the cost of having these items removed.

If, on the other hand, it does, the buyer can apply with the court of law to receive a performance order and claim damages. By rescinding the contract, the buyer can recover any amounts paid as a deposit and claim any charges owed.

Notice of Vacant Possession

The Sales and Purchase Agreement (SPA) is what defines the handover date on a Notice of Vacant Possession. On properties with a Strata title, the date is limited to a period of 36 months. Individual titles are limited to 24 months.

The period becomes active as soon as the SPA is signed. After the date, buyers can take over the new property and the defect liability period inches closer.

The Defect Liability Period

The defect liability period pertains to the amount of time a buyer has to indicate any problems present in the new property and communicate them to developers for repairing. The countdown to this period will begin as soon as the seller issues a Notice of Vacant Possession.

Buyers should always take advantage of the grace period to identify these trickier repairs and replacements:

  • Moisture stains, such as discolouration on drywalls or floors—this could indicate potential water problems

  • Shut-off valves that may require special tools to operate or at risk of incurring a plumbing leak

  • Broken locks that need rekeying or replacement

  • Circuit breaker boxes that need inspection

  • Dysfunctional smoke detectors

  • Heating and cooling filters that need swapping out

  • Damaged roofing with missing shingles, rusted flashing, or buildup

  • Foundation faults that may occur in the basement or a crawlspace

  • Electrical outlets at risk of causing shortages

  • Bugs and pests

If purchasing a home, as much as possible, refrain from attempting to perform repairs yourself. With your liability period active, it’s best to seek professional help to prevent the problem from escalating.

The Completion and Compliance Certificate

The Certificate of Completion and Compliance (CCC) is what allows new tenants to finally move into their new space. The local council is responsible for releasing this document, indicating that the property is safe for occupation.

The Legal Consequences of Breaking a Vacant Possession Contract

Depending on the severity of the breach of a real estate contract, sellers will either have to compensate the buyer for damages, return the deposit fund, which can run up to 1% or 3% of the property’s purchase price, or complete a court-ordered sale of the home.

Though buyers are well within their rights to sue a seller for a breach of contract, the process involves a court order and combatting appeals, which can become time-consuming and expensive. Thus, most homebuyers aren’t going to go through the hassle of enforcing legal rights.


Any contract exchanged between buyer and seller will remain unique to the transaction at hand. Should there be any damages to pay, this amount will ultimately rely on the nature of the circumstances and how the loss occurred.

As a general rule, always read between contract lines and note any discrepancies as soon as you encounter them. Work with your real estate attorney to comb through unclear terms and problematic stipulations.

Whether you’re buying or selling a home, start getting a leg up on conveyancing quotes by consulting online tools at Conveyancing Calculator. Our fees are fully transparent and easily comparable to those of nationwide property solicitors.

All our conveyancers are SRA regulated and CLC licensed who can provide a full cost breakdown including VAT and disbursements. Start receiving conveyancing advice by giving us a quick call!


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