The Property Law Bill 2023 was passed by legislative assembly on 25th October 2023. This bill modernises Queensland’ property legislation and implements a seller disclosure scheme in Queensland. Once enacted sellers of free-hold land, which would include lots in a body corporate, will be required to disclose relevant information to a buyer in a single document.
A disclosure statement will be required for all property sales in Queensland once the Bill is enacted. This article focuses on what will happen for lots in a body corporate and the phasing out of section 206 disclosure statements.
Pending Changes to Disclosure Requirements for Bodies Corporate
Currently, when selling a lot in a body corporate, sections 206 and 223 of the BCCM Act 1997 require that certain information must be disclosed to the buyer. Section 206 requires basic information about the body corporate be disclosed, including current levies and contact details, and section 223 requires patent and latent defects be disclosed.
The Property Law Act 2023, when enacted, will repeal various parts of section 206 BCCM Act 1997 and replace them with other requirements.
Specifically, Section 206 disclosure statements will be replaced with a Body Corporate Certificate which must be purchased directly from the body corporate or their agent.
What’s included in the Body Corporate Certificate is not finalised.
Section 223 remains unchanged, so sellers will still be required to disclose latent and patent defects to buyers.
New Timeframes and Costs for Disclosure Requirements
Although the Bill has been passed, its not yet enacted and timing has not been established. Regulations still need to be written. Part of those regulations will be an outline of what is included in the Body Corporate Certificate.
The Strata Search Agents Association Qld (SSAAQ), of which Mybodycorpreport.com.au is a member, hopes to be invited to consult with the Department of Justice when deciding the actual makeup of what is included in the document.
Turnaround times and costs will also be impacted.
The Bill allows up to six days for the body corporate to supply the Body Corporate Certificate, once ordered.
Costs are also expected to be higher because more documentation will be included. Actual cost is likely to be standardised by the Act but cannot yet be set as content is not finalised.
The passed Bill is likely to be enacted in the next few weeks with a generous lead time given before the provisions take effect. Discussion held with Department of Justice indicate up to 12 months. This timing is to allow stakeholders, which will include strata managers, bodies corporate, search agents such as us, and real estate agents to get up to speed with those changes.
How This will Impact Our Business?
Currently I’m choosing to see these changes as an opportunity however there is no denying these changes are going to significantly impact the offerings and services for our business.
Section 206 disclosure statements will cease when the provisions take effect.
Until the content of the Body Corporate Certificate is finalised we cannot form a strategy around ascertaining latent and patent defects.
Changing the information swapped at contract stage will also impact due diligence information we include in the pre purchase strata reports. Expect changes there as we adapt our reports to focus on verifying disclosure and filling in gaps.
Conclusion
The Property Law Bill 2023 has been passed and will be enacted into law.
Significant changes are coming to Queensland property sales. We are monitoring the situation and will actively be making changes in the interim.
Until then, property sales, disclosure, and due diligence inspections will continue as usual.