The usual documents involved in the acquisition of real estate include the following:

• Title searches of relevant lots
• Survey to establish boundaries, encroachments and in some cases lettable areas
• Planning and other statutory certificates to establish zoning and use controls and matters affecting the real estate
• Environmental reports, including contamination reports
• Building condition reports
• Due diligence report in the case of commercial transactions
• Sale and purchase agreement
• Financing documentation

A seller usually gives warranties in relation to tenancies on the property and other third-party rights and warranties relating to the state of the property, particularly in the case of contamination. Additionally, where a buyer is concerned about specific risks, or is aware of certain risks but is unable to quantify those risks, the buyer may request that the contract for sale includes warranties from the seller in relation to those risks.

In most states and territories, statutory warranties are required by law from a seller. These warranties can be quite extensive and usually cannot be modified or contracted out of. Most warranties relate to any interest or proposal by government authorities and other third parties such as orders and notices affecting the property. The buyer usually has a right to terminate the contract for sale for a breach of these statutory warranties unless relevant disclosures are made.

Parties are usually only legally bound when they sign and exchange the formal contract of sale documents. The sale documents are often drafted to be conditional upon matters such as satisfactory due diligence or approval under the FATA and 2015 Regulations, meaning the parties to the sale documents cannot be compelled to complete these contracts until the relevant conditions are satisfied.

Other conditions precedent may include the approval of another party such as a head lessor (if the transaction involves the acquisition of a leasehold interest) or the approval of the transfer of a liquor license by the relevant state-based government authority (where alcohol is sold at the target property).

Under the Torrens title system, legal title is only transferred upon the registration of the title transfer documentation, into the buyer’s name, which usually takes place immediately on the closing of a property transaction.

Australia has recently introduced electronic conveyancing, which facilitates the settlement of property transactions in secure online workspaces. Under this approach, certain registered parties (e.g., legal practitioners) may undertake the settlement process in an online portal, including completing and lodging instruments, transferring funds and ultimately settling the transfer of an interest in real estate. This replaces the need to physically lodge paper transfer documentation and registration instruments with the relevant government authority.

Property Exchange Australia (PEXA) is the only electronic conveyancing platform available in Australia and in certain states and territories the use of PEXA for certain property transactions is mandatory.

In respect of sales, the buyer usually pays for the following:

• Buyer’s legal costs (including the preparation of a due diligence report)
• State-based stamp duty
• Registration fees

The seller usually pays for the following:

• Seller’s legal costs
• Real estate agent’s commission and fees
• Any income or capital gains tax on any profit made on the sale

With commercial leases, it is not usual for the landlord to require the tenant to pay the landlord’s costs of preparing, negotiating and settling the lease documentation.