A Simple Guide to Property Boundaries and Pre-Settlement Checks

When it comes to buying or selling property in Queensland, there's a lot of fine print that can have major implications, especially around property boundaries. One of the most overlooked yet critical clauses in the standard REIQ Contract is Clause 7.5, which deals with boundary errors, title discrepancies, and service line issues. Whether you’re preparing to sell or about to buy, understanding this clause can save you from costly surprises.

So, what is Clause 7.5?

Clause 7.5 of the REIQ Contract outlines how certain property-related errors, such as boundary issues or incorrect lot sizes, must be handled before settlement. These are not issues that can be raised later on without significant limitations.

Here’s what Clause 7.5 covers:

• Boundary or Area Errors: If a buyer conducts a survey and finds that the actual boundaries or area of the lot differ from what's stated in the title, that’s a problem.

• Unapproved Encroachments: Think fences, sheds, or driveways that extend onto neighbouring land or vice versa.

• Rogue Services: If pipes, cables, or drainage lines run through the property but don’t service it, or were never approved, this may cause concern.

• Title Errors: If there’s a mistake in the seller’s registered title (such as the wrong lot description), it needs to be addressed.

Under Clause 7.5, if any of these issues are discovered, the buyer has the right to terminate the contract, but only before settlement.

What happens after Settlement?

If a buyer proceeds to settle without formally raising these concerns, the opportunity to terminate the contract is gone. The only option that remains is to seek compensation, but only if the issue was raised in writing before settlement.

In short:

• Act early, and you have options.

• Wait until after settlement, and your options are extremely limited.

Why this matters for Buyers

As a buyer, investing in a professional survey before settlement is crucial. It can identify hidden problems that might otherwise go unnoticed, until it's too late. If you uncover something that’s off, you need to raise it in writing with your solicitor before settlement day.

Failing to do so may mean accepting a property with boundary or title issues, and limited recourse.

Why this matters for Sellers

Sellers should be proactive too. You may not even realise your property has a boundary discrepancy or encroachment issue until it’s too late. By getting ahead of potential problems, either with your own survey or through transparent disclosure, you reduce the risk of your sale falling over and protect your reputation.

Buyers are becoming increasingly savvy, and with more of them conducting pre-settlement surveys, it’s in your best interest to ensure your title and boundaries are accurate and defensible.

For both buyers and sellers, Clause 7.5 of the REIQ Contract isn’t just a footnote, it’s a critical protection mechanism. Buyers must conduct their due diligence and raise issues early. Sellers should consider preemptively addressing any boundary concerns to keep the contract on track. Buying or selling? Make sure you understand your rights and obligations, because once settlement happens, there’s no turning back. If you're unsure, speak with your solicitor or real estate agent before you sign the dotted line.