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Buying a home in Melbourne should feel exciting, not like a never ending admin slog. Yet the moment you decide to buy and the moment both parties sign a binding contract are rarely the same day. In Victoria, the deal is not done until the buyer and seller have both signed the contract of sale, which is when the property is considered sold. That signing point is what most people mean by the exchange of contracts.
Below is a clear, Melbourne focused run through of the most common roadblocks that delay exchange, what they mean in practice, and how to keep things moving.
First, a Quick Refresher on How Exchange Works in Victoria
In a private sale, you can negotiate price and terms, then sign the contract. You may include conditions such as subject to finance, subject to the sale of your current home, or subject to a building and pest inspection. Once both parties sign, the property is sold, and any deposit is held in trust until settlement unless validly released earlier.
Before anyone signs, the seller must provide a Section 32 vendor statement. This disclosure document is legally required and must be accurate, because it tells you about mortgages, covenants, easements, zoning and outgoings. If it is incomplete or misleading, the buyer can often walk away or take action.
What Commonly Holds Up Exchange of Contracts
1. A Missing or Incomplete Section 32 Vendor Statement
If the Section 32 is not ready, no one should sign. Preparing it can take time because it relies on property certificates and searches. Expect information about title details, planning and outgoings, and if it is a strata property, an owners corporation certificate. Any errors or omissions can stall exchange until corrected.
For apartments and townhouses with a body corporate, the owners corporation certificate is mandatory and the owners corporation has up to 10 business days from a valid request and payment to issue it. That statutory window alone can push out your signing timeline if the certificate is ordered late.
Other items that often take time include planning and flood certificates. These are ordered through the Victorian government's channels and water authorities, and they are frequently needed to complete the disclosure. If they have not been requested early, you will be waiting.
2. Owner Builder Works That Trigger Extra Disclosures
If the seller did owner builder work in the last six years and six months, the law usually requires a Section 137B defects report and, where applicable, domestic building insurance. If the seller has not arranged this, you cannot expect a quick exchange. It takes time to organise the inspection and compile the report.
3. Finance That Is Not Truly Ready
Many buyers sign subject to finance. That is sensible, but you still need momentum behind your application. Lenders commonly order a valuation, check employment and reassess borrowing if your position shifts. The standard Victorian contract expects you to nominate a lender for the finance condition, so if you are shopping around without clarity, approval can drift and hold up the signing or make your offer less attractive.
4. Building and Pest Inspections That Are Not Booked in Time
Inspections are a standard condition for private sales. Coordinating access, engaging a reputable inspector and waiting on the report can add days. If you are keen to exchange swiftly, line this up as soon as your offer is in play.
5. Identity Checks and Electronic Signing Hiccups
Electronic settlements are the norm in Victoria, and with that comes mandatory verification of identity. Your conveyancer or lawyer must take reasonable steps to verify you in line with ARNECC's participation rules, and platforms such as PEXA have VOI requirements baked in. If you have not completed VOI or your documents do not match, expect a pause.
Digital signing itself is not the issue, since modern Victorian contract platforms support secure e-signatures, but signatories still need to be correctly named and available. Company buyers must ensure the right officeholders sign with the correct authority, or you can lose days fixing execution.
6. Title Problems That Need Clearing
Two standouts here:
- An existing mortgage on the seller's title. That mortgage will be discharged at settlement, but the seller's bank generally needs lead time to process the discharge authority. Industry timelines often run to a couple of weeks to line up discharge and book settlement, so if the seller delays signing their discharge forms, it can ripple back to negotiations and discourage an early exchange.
- A caveat on title. A caveat can prevent dealings until it is withdrawn or lapsed. If a third party has lodged one, you may need a formal withdrawal or other legal steps to remove it, and parties will often hold off signing until there is a clear plan for removal.
7. Foreign Investment and Tax Settings for Overseas Buyers
Foreign purchasers generally need FIRB approval before buying residential property in Australia. For practical purposes, this is usually built in as a contract condition, and waiting for approval can push out exchange if the buyer wants the approval in hand first or if the seller insists on it. On top of that, foreign purchaser additional duty applies in Victoria, which adds to cost planning and documentation.
The State Revenue Office confirms that foreign purchaser additional duty is currently 8 per cent for contracts from 1 July 2019, and all buyers must complete the digital duties form. If you are a foreign buyer, factor both into your timeline and paperwork.
8. Contract Terms That Need More Negotiation
Even when the price is agreed, people still pause over the small but meaningful stuff. Think settlement period, chattels such as the fridge or outdoor heater, and minor special conditions. In Victoria, settlement is commonly 30 to 90 days, but a seller who needs a longer date, or a buyer who needs sooner access, can spend several rounds getting the words right. If there are multiple offers, a seller might favour a clean, unconditional contract, which can press you to clarify your position before anyone signs.
9. Early Release of Deposit Requests
Section 27 of the Sale of Land Act allows a vendor to request early release of deposit money. Buyers are not obliged to agree, and objections are permitted in certain circumstances. In any case, you cannot release the deposit until 28 days after the contract date and the contract must be unconditional, so adding a Section 27 conversation before exchange can become a side track that slows everyone down.
10. Cooling Off Rules and Auction Timing
Private sales of residential property and small rural land in Victoria come with a three business day cooling off period, with well known exceptions such as purchases at or near auction. Parties sometimes plan to sign only once they are sure those timelines work for them, which can push signing to later in the week if everyone prefers to avoid a weekend or public holiday complicating the count.
11. GST and Other Drafting Errors
The contract must clearly state whether the price includes GST and, if new residential premises are involved, the seller and buyer need the right tax settings explained in the contract. Typos in names, wrong lots, or missing annexures also cause last minute rewrites. It sounds basic, yet it is a classic source of delay.
How to Keep Your Melbourne Exchange on Track
Order and Check the Section 32 Early
If you are selling, instruct your conveyancer to order certificates as soon as you decide to list. Do not leave the owners corporation certificate to the last minute given the 10 business day issue period. A clean, complete Section 32 is the single best way to prevent an exchange delay. If you are buying, have a professional review of the Section 32 so you can sign with confidence the moment your other boxes are ticked.
Sort Owner Builder Paperwork Upfront
Selling within six years and six months of owner builder works means you will likely need a Section 137B report and, if the works value warrants it, domestic building insurance. These take time to arrange and should be booked well before you expect to sign.
Be Realistic About Finance and Valuations
Get a genuine pre-approval and talk to your lender or broker about valuation lead times in your area. If your contract will be subject to finance, nominate your lender, and set a timeframe you can meet. That way your offer looks solid and you are not the reason an exchange slips.
Book Inspections Early and Line Up Access
Melbourne's inspection diaries fill quickly, especially on weekends or when a property is tenanted. Lock in your building and pest inspector as soon as the seller signals they are open to your offer, then ask the agent to confirm access.
Complete Verification of Identity
Ask your conveyancer for their VOI checklist on day one and complete it promptly. Make sure your names match across your passport, driver licence and contract, especially if you use a middle name or have recently changed your name. VOI delays are avoidable.
If You Are Selling, Sign Your Discharge Authority Straight Away
Your lender needs time to prepare the discharge of mortgage for settlement. The earlier you sign the discharge authority, the smoother your timeline looks to buyers and agents, which can make them more comfortable exchanging sooner.
Deal With Caveats Before You List
If you know there is a caveat on your title, talk to your lawyer now about getting it withdrawn or otherwise removed. Buyers and their advisers get nervous signing while a caveat looms with no plan.
Foreign Buyer or Trustee Purchaser? Start Approvals and Forms Early
Foreign purchasers should start FIRB applications promptly and budget for Victoria's foreign purchaser additional duty. All buyers should be ready to complete the State Revenue Office digital duties form. These are not signing day tasks, so do not let them become signing day blockers.
Keep Your Special Conditions Simple and Specific
If you need a particular settlement date, or want certain appliances included, say so in plain terms. Vague conditions create back and forth. Clear words help the deal reach the signing table faster.
Melbourne Specific Quirks to Watch
- Apartments and new townhouses. Owners corporation certificates and by-laws often take the longest to source. Order them first.
- Properties near waterways or with overlays. Flood advice and planning overlays are part of proper disclosure. If they are missing, expect your conveyancer to ask for them before recommending you sign.
- Auctions. Contracts at auction are unconditional and cooling off does not apply. You will want your finance and due diligence done before you raise your hand.
A Simple Exchange Checklist
- Seller: instruct your conveyancer, order Section 32 certificates and the owners corporation certificate immediately, and if relevant, arrange the Section 137B report.
- Buyer: get a real pre-approval, nominate your lender for any finance clause, and book inspections early.
- Everyone: complete VOI promptly and ensure signatories are ready for digital signatures.
- Check contract details: GST position, inclusions, settlement date and special conditions should be precise and workable.
- Address title issues: if there is a caveat or other encumbrance, have a written plan to deal with it before signing.
Bottom Line
Exchange stalls when disclosure is incomplete, when conditions are vague, or when the practical steps behind finance, inspections and identity are left to the last minute. The Victorian process rewards people who front-load the work. If you are proactive, and your team is organised, there is no reason your Melbourne purchase or sale should meander.
Need Help Getting to Exchange Quicker?
Pearson Chambers Conveyancing helps Melbourne buyers and sellers move from handshake to signed contract with fewer surprises. If you want a second set of eyes on the Section 32, clear wording for your conditions, or simply a calm guide through the steps, we are here.
Contact Pearson Chambers Conveyancing for more details and a free Section 32 contract review.
Phone: 03 9969 2405