Subdividing and selling land
If you are a small-scale developer (5 subdivisions or fewer), many of these rules do not apply.
Interests and benefits
You must disclose to a potential buyer if you or someone else has interest in, or may benefit from, a sale. Use the required form to make this disclosure.
You must do this even if you are a small-scale developer.
Download the Disclosure to potential buyer form.
You must make this disclosure if you:
- have at least a 15% interest in the property
- pay any benefits (such as fees or commissions) to a third party.
A developer will need to clearly identify a proposed lot to a buyer. We have clarified the rules so that buyers get clear, consistent information.
For example, for subdivided land, the seller must disclose:
- the proposed number of the lot
- the total area of the lot
- the proposed orientation of the lot (by referring to north).
Disclosure statement and plan
Before you enter into a contract for a proposed lot, you must give the buyer:
- a signed disclosure statement
- a disclosure plan.
These documents will set out the current proposed details about the lot.
The disclosure statement will set out:
- that you have given the buyer a disclosure plan
- whether you have applied for (or been granted) development approval
- that settlement must be within 18 months of the day you sign the contract
- that you must give the buyer a copy of the registered plan of survey.
The disclosure plan gives information about the lot’s:
- dimensions and area
- planned earthworks during the development
- proposed orientation (by referring to north).
A registered cadastral surveyor will need to prepare your disclosure plan. This will give greater protection and confidence for consumers.
The Surveyors Board Queensland can help you learn more or find a registered surveyor.
If a disclosure is incorrect (due to error or a change in plans), you will need to:
- issue a statement to change the original disclosure
- give this to the buyer (as soon as practicable) after the proposed lot is registered.
Deposit trust monies
A buyer must directly pay into a trust account, any money that is going towards the buying or paying off of a proposed lot.
The trust account must be administered by:
- a real estate agent
- a law practice
- the Public Trustee.
Your contract may set out a specific entity (in any of the above categories) to administer the trust monies. If a specific entity is not set out, you will need to use the Public Trustee. It is an offence to breach these provisions.
The maximum penalty is $24,380 or 1 year imprisonment.
These now apply to any payment toward a proposed lot, regardless of whether they were set out in the sale contract or any other instrument (such as an invoice for a part-payment).
Your trust account administrator will need to follow the usual laws that cover how they deal with trust monies. They will need to follow the trust account rules:
Terminate a contract
A buyer has a right to terminate the contract if:
- they find out that there is a change to the initial disclosure about the state of the land, and
- the change will cause a significant disadvantage for the buyer (known as material prejudice).
This could be (whichever is sooner):
- within 30 days of receiving the notification
- before the title of ownership transfers to the buyer.
In this approach:
- the seller must notify the buyer of a change between the disclosure material relating to the proposed lot and the proposed final product
- the buyer must show that the change is a significant disadvantage to terminate the contract
- the Courts have set a precedent to decide if a disadvantage is a material prejudice.