How Long Does Conveyancing Take in NSW?

One of the most common questions asked by buyers and sellers is: "How long does conveyancing take?"

In New South Wales, the standard settlement period for a residential property transaction is generally 42 days from the date of exchange of contracts. However, this is not a fixed rule. The settlement period is negotiable and may be shorter or longer depending on the circumstances of the parties and the terms agreed in the contract.

While many transactions settle within the agreed timeframe, factors such as finance approval, lender requirements, and simultaneous settlements can affect the overall process.

The Standard Conveyancing Timeline

Once contracts are exchanged, the parties enter the period between exchange and settlement. During this time, a number of important legal and financial steps must be completed before ownership can be transferred.

For buyers, this often includes obtaining formal finance approval, satisfying any lender requirements, arranging insurance, and preparing funds for settlement. For sellers, it may involve liaising with their lender to discharge an existing mortgage and ensuring all necessary documentation is in order.

The conveyancer or solicitor will also carry out various searches and enquiries, prepare settlement documents, calculate adjustments for council rates, water rates and other outgoings, and coordinate the settlement process through the electronic settlement platform.

Prior to settlement, the buyer will usually conduct a final inspection of the property to ensure it remains in the same condition as when the contract was entered into.

Although 42 days is the most common settlement period in NSW, the parties can agree to a shorter or longer timeframe if it better suits their circumstances.

Simultaneous Settlements

A common situation that can affect the conveyancing timeline is a simultaneous settlement.

This occurs when a seller is also purchasing another property and intends to use the proceeds of their sale to fund their purchase. In these circumstances, the sale and purchase settlements are linked together and must be carefully coordinated.

For example, a seller may be selling their current home and purchasing a new property on the same day. The funds received from the sale are required to complete the purchase. As a result, multiple parties, lenders, conveyancers, and settlement agents may all be involved in a chain of transactions.

While simultaneous settlements are common and are successfully completed every day, they require additional coordination. If one transaction experiences a delay, it can potentially affect the timing of the other linked settlements.

What Can Delay Settlement?

Although most transactions proceed smoothly, delays can occasionally occur.

One of the most common causes of delay is finance. A buyer may experience delays in obtaining formal loan approval or meeting conditions imposed by their lender. Banks may also require additional time to prepare mortgage documentation or arrange settlement.

Delays can also arise where important documents have not been signed, identification requirements have not been completed, or further investigations are required following property searches.

In some cases, issues relating to the title of the property, existing mortgages, or settlement booking arrangements may need to be resolved before settlement can proceed.

Where a transaction forms part of a simultaneous settlement chain, delays affecting one property can sometimes have flow-on effects for other linked transactions.

What Happens If Settlement Is Delayed?

A delayed settlement does not necessarily mean that the contract will come to an end. The consequences will depend on the circumstances of the delay and the terms of the contract.

In many cases, if the purchaser is responsible for the delay, they may be required to pay default interest for each day settlement is postponed. If the delay continues, a Notice to Complete may be issued, requiring the defaulting party to complete settlement within a specified period (generally 14 days).

Because the consequences of a delayed settlement can be significant, buyers and sellers should seek advice as soon as they become aware of any issue that may prevent settlement from occurring on time.

Conclusion

While the standard settlement period in NSW is generally 42 days from exchange of contracts, every property transaction is different. The agreed settlement date can be negotiated to suit the parties' needs, and various factors may affect the overall timeline.

Finance approval, lender requirements, simultaneous settlements, and administrative issues can all influence how long conveyancing takes. Engaging an experienced solicitor or conveyancer early in the process and responding promptly to requests for information can help minimise delays and contribute to a smoother settlement experience.

Disclaimer

This article is intended to provide general information only and does not constitute legal advice. Conveyancing timeframes vary depending on the circumstances of each transaction and the terms of the contract. You should obtain independent legal or conveyancing advice regarding your specific situation.