Buying a property in Sydney’s Inner West is an exciting step, whether you’re a first-home buyer, an investor, or simply relocating to enjoy the vibrant lifestyle this area offers. From eclectic suburbs like Newtown and Marrickville to the more relaxed vibes of Balmain or Dulwich Hill, the Inner West has something for everyone. But while the real estate market here offers great potential, the legal side of purchasing property—conveyancing—can be complex and intimidating.
To navigate the process smoothly and avoid costly mistakes, it’s vital to understand the key legal terms commonly used in conveyancing. This blog breaks down the most important conveyancing terms every Inner West buyer should know, so you can approach your property purchase with confidence.
What Is Conveyancing?
Conveyancing is the legal process of transferring ownership of real estate from one person to another. In New South Wales (NSW), this involves preparing, verifying, and lodging legal documents, conducting searches, handling financial arrangements, and ensuring both parties meet their contractual obligations.
The process typically begins once a buyer makes an offer on a property and ends on settlement day, when the keys are handed over and ownership officially changes hands.
Why Conveyancing Matters in the Inner West
The Inner West of Sydney is a dynamic and competitive property market. Homes are often sold at auction, and due diligence needs to be completed quickly. Given the region’s diverse housing stock, heritage overlays, zoning complexities, and development controls, a solid understanding of conveyancing terms is critical to avoiding legal pitfalls and making informed decisions.
1. Contract of Sale
The Contract of Sale is a legally binding document outlining the terms of the property transaction. It includes:
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Purchase price
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Settlement date
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Property inclusions/exclusions
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Special conditions (e.g., subject to finance or building inspection)
In NSW, sellers must have a Contract of Sale prepared before listing a property. Buyers should review this document carefully with their conveyancer before signing.
Why it matters: The Contract is central to the transaction. Once exchanged, you are legally committed to buying the property—unless certain conditions apply.
2. Cooling-Off Period
In NSW, residential property purchases (except those bought at auction) come with a 5-business-day cooling-off period. This gives buyers time to conduct inspections, arrange finance, or withdraw from the purchase.
If you change your mind during the cooling-off period, you can cancel the contract but will forfeit 0.25% of the purchase price.
Note: You can waive or shorten the cooling-off period by signing a Section 66W Certificate, often requested in competitive markets like the Inner West.
3. Exchange of Contracts
This is when both buyer and seller sign and exchange identical copies of the Contract of Sale, making the agreement legally binding. A deposit (usually 10%) is paid by the buyer at this stage.
Why it matters: Until contracts are exchanged, either party can pull out of the deal. The exchange date also starts the countdown to settlement.
4. Settlement
Settlement is the final step in the conveyancing process. It typically occurs 4 to 6 weeks after the exchange of contracts and involves:
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Final transfer of property ownership
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Payment of the remaining purchase price
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Handover of keys to the buyer
Your conveyancer will liaise with the seller’s legal team and your lender to ensure a smooth settlement.
Pro tip: Don’t schedule movers or renovations until settlement is confirmed. Delays, though rare, can happen.
5. Disbursements
Disbursements are costs paid by your conveyancer on your behalf during the transaction. These may include:
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Title searches
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Property certificates
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Zoning information
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Council and water rates
Understanding these costs is important for budgeting and transparency.
6. Easement
An easement is a legal right for someone else to use part of your property for a specific purpose, such as:
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Access to a neighbour’s property
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Sewer or stormwater drainage
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Utility access (gas, water, electricity)
Before buying, your conveyancer will check the title for easements, as they can limit how you use your land.
7. Encumbrance
An encumbrance is a burden or claim on a property that may affect its transfer or value. Common types include:
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Mortgages
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Caveats
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Easements
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Restrictive covenants
Encumbrances must be disclosed in the Contract of Sale. Your conveyancer will verify that the property will be transferred free of these, or help you understand their implications.
8. Caveat
A caveat is a legal notice that someone other than the owner has an interest in the property. It prevents the sale or transfer of the title without the caveator’s knowledge.
For example, a builder who hasn’t been paid may lodge a caveat until the debt is resolved.
Why it matters: If a caveat exists on the title, it can delay or derail your purchase.
9. Title Search
A title search confirms the legal ownership of the property and identifies:
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Current owner
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Encumbrances
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Easements
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Zoning restrictions
Your conveyancer will conduct a title search early in the process to ensure there are no surprises.
10. Strata Title vs. Torrens Title
In the Inner West, you’ll encounter different types of property titles:
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Torrens Title: You own the land and dwelling outright.
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Strata Title: Common for units or townhouses, you own your unit plus shared ownership of common areas (e.g., lifts, gardens, driveways).
Strata properties come with additional considerations like by-laws, levies, and owners corporation rules.
11. Building and Pest Inspection
Though not legally required, these inspections are strongly recommended. They check for:
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Structural issues
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Termite damage
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Water leaks
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Asbestos
You should complete inspections before the cooling-off period ends (or before exchange if buying at auction).
12. Stamp Duty (Transfer Duty)
Stamp duty is a state government tax on property purchases. In NSW, the amount depends on:
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Purchase price
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Whether you’re a first-home buyer
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Use of the property (residence or investment)
Your conveyancer will calculate and lodge this payment. First-home buyers may be eligible for exemptions or concessions.
13. Section 10.7 Certificate (Zoning Certificate)
Issued by the local council, this certificate shows:
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Zoning of the land
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Development controls
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Land use restrictions
It’s important in the Inner West where heritage overlays and planning restrictions are common.
14. Settlement Adjustment
On settlement day, costs like council rates, water rates, and strata levies are adjusted between the buyer and seller. For example, if the seller has prepaid council rates, you may need to reimburse them a pro-rata amount.
15. Identity Verification
To prevent fraud, NSW requires buyers and sellers to verify their identity using 100 points of ID. This is often done in person or via secure platforms approved by the Australian Registrars’ National Electronic Conveyancing Council (ARNECC).
16. PEXA (Property Exchange Australia)
PEXA is Australia’s digital conveyancing platform used for e-settlements. It allows conveyancers, banks, and land registries to settle property transactions online in real time.
Most settlements in the Inner West are now completed electronically via PEXA, offering speed, security, and efficiency.
17. Legal Practitioner vs. Licensed Conveyancer
Both legal practitioners (solicitors) and licensed conveyancers can handle property transactions, but their qualifications differ:
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Solicitor: A lawyer who can handle complex legal issues beyond property law (e.g., disputes, wills).
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Conveyancer: A specialist in property law transactions.
For straightforward residential purchases, a conveyancer is usually sufficient. For complex matters, like buying off the plan or dealing with disputes, a solicitor may be more appropriate.
18. Off-the-Plan Purchase
An off-the-plan purchase means you’re buying a property (usually a unit) that hasn’t been built yet. This carries additional risks, including:
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Delays in completion
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Design changes
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Market value fluctuations
Off-the-plan contracts are more complex, so seek legal advice before committing.
19. Sunset Clause
This clause appears in off-the-plan contracts. It sets a deadline for the property’s completion. If the developer doesn’t complete construction by this date, the contract may be terminated by either party.
20. Due Diligence
This is the process of thoroughly investigating a property before purchasing. It includes:
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Legal document review
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Title searches
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Council and zoning checks
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Building inspections
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Strata report (for units)
Your conveyancer will handle much of this, but you should remain informed and involved.
Final Thoughts: Knowledge Is Your Best Asset
Conveyancing in the Inner West can be straightforward with the right support and knowledge. The region’s unique mix of heritage homes, apartment blocks, and rezoned industrial spaces makes legal clarity all the more important.
By understanding these key legal terms, you’ll be in a stronger position to:
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Avoid common pitfalls
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Ask informed questions
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Negotiate confidently
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Protect your investment
Whether you’re purchasing a Victorian terrace in Annandale, a sleek apartment in Petersham, or a cottage in Haberfield, working with a trusted local conveyancer and being across the legal lingo will help ensure your Inner West property journey is a success.
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