The differences between residential and commercial conveyancing
Whether you are purchasing or selling a home, residential investment, or a commercial investment, there are many similarities involved in the transfer of ownership of these different kinds of properties.
There are also some important different in the processes and complexities involved that you should be aware of. GLG Legal can assist you in all types of conveyancing and engaging us will mean that you have a solicitor there every step of the conveyancing process to assist you.
Residential conveyancing in Queensland is generally quite straight forward and there are standard contracts available for residential conveyancing from the Real Estate Institute of Queensland (REIQ) and Queensland Law Society.
Whilst there are standard contracts available, there are still numerous considerations and disclosures you must make which is why it is essential to engage a lawyer for your conveyance.
If you are selling a property, the disclosures you are required to make to the buyer of a residential property include any encumbrances affecting the property, and whether you have compliant smoke alarms and safety switches, among other things. Engaging a lawyer can assist you in making these disclosures during your sale. Any requirement that isn’t disclosed can give the buyer the right to terminate the contract which is why it is so important to seek legal advice.
Seeking legal advice can also assist in ensuring that the contract is suited to your individual circumstances. For example, maybe you need to sell your existing property simultaneously to fund the purchase of your new property – this would need to be included in the contract of sale. A solicitor will be able to include clauses specific to your property and to your sale or purchase.
Residential property investments are much more common; however, a commercial property investment is another type of asset that often offers high returns. With this comes more risks and requirements from you, and it will depend on your individual circumstances to determine which investment is most suitable. Due to the increased risk, it is essential that you seek legal advice in commercial property transactions.
Commercial conveyancing is generally a lengthier process than that of residential, and usually the risker of the two investments. There needs to be an investigation of the permitted uses of the land, zoning, the details of any leases in place, and many other factors. Due diligence must also be undertaken to investigate the property and anything that may affect the seller’s ability to transfer title to the buyer; this can be a lengthy process.
Often a commercial property will have a tenant in place, and these agreements are usually negotiated between the tenant and the landlord. It therefore is imperative to have a solicitor review any lease agreements before you sign the contract to ensure you are aware of the terms and any rights the tenant may have. There should also be research conducted into the financial situation of the tenants.
You must also consider that GST will be payable upon the purchase of a commercial property.
In Summary, whether you are engaging in residential or commercial conveyancing, receiving advice and having a solicitor throughout the process can mitigate any risks to you and ensure that the process of your sale or purchase goes smoothly.