Have you ever heard this term and wondered what its all about? Well here's a detailed explanation and links to examples and the legislation to help clarify what it's all about.
Pre Contract Disclosure Statement aka Form 18
When selling a property such as an apartment or town house in a body corporate, the updated Unit Title Act 2010 implemented disclosure rules for vendors & agents when selling a unit title property. It’s now a requirement for vendors to provide prospective purchasers with a “pre-contract disclosure” aka “Form 18” upon viewing the property prior to making an offer. This falls under section 147 of the Act.
This provides the purchaser with more detailed info regarding the financial position of the body corporate as well as any upcoming maintenance or possible weather tightness issues in the past. Typically purchasers will also ask for copies of previous AGM and EGM meeting minutes to assist in their due diligence if they’re seriously interested in a property. If you’re dealing with an organised agent they will have all this info ready to send in electronic form to those that want to get started on their due diligence quickly.
Section 146 of the Unit Titles Act
146 Pre-contract disclosure to prospective buyer
Before a buyer enters into an agreement for sale and purchase of a unit the seller must provide a disclosure statement (apre-contract disclosure statement) to the buyer.
The pre-contract disclosure statement must be in the prescribed form and contain the prescribed information.