In this blog we explain in 3 minutes what you need to know regarding the "tenancies" section of the contract. If there are tenants involved in your contract of sale, you MUST READ THIS!

You will learn about vacant possession, timeframes to evict tenants, fixed vs periodic tenancies, dealing with Transfer Duty Concession and eligbility concessions, etc...

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Hi everybody - George Sourris, Empire Legal.

Today's topic: How to deal with tenants on a sale contract in QLD property.

This week's topic is exploring the "tenancies" section on the contract. Please keep in mind we're talking about REIQ contracts only!

Quite often a buyer thinks that just because the expiry of a lease is prior to settlement, that a tenant will have vacated prior to the settlement itself. This is not the case, as the tenancy will switch to a periodic after the fixed term expires. If the tenancy section on page 3 of an REIQ contract is left blank, then vacant possession MUST be provided at settlement, or the vendor is in breach of contract.

When the tenancy section of the contract is completed, the contract is NOT subject to vacant possession, even in the event the fixed term noted ends before the intended settlement date. There are rules and timeframes that must be followed when ending a tenancy.

A tenant, property manager or property owner can all issue a notice to end a tenancy - if the correct notice and form is not used, the other person may ask for compensation.  As a landlord, you or your property manager need to fill out and provide to the vendor a "Notice to Leave" (Form 12). The minimum notice required is two months.

So, for example, the tenancy section on page 3 is filled out, with the tenancy ending on 01 Februray 2024. Lets assume that the settlement date is also 01 February 2024. 

Notice would have needed to be given two months prior by the landlord, so 01 December 2023 - in writing in order for the tenants to be out in time for settlement. This is where a lot of issues occur,  as on a traditional 30 day contract, the notice period required exceeds the length of the sale contract.

We suggest you get in touch with our office, both as a seller or a buyer, if there is an existing tenancy on the property. We will give you the right advice and make sure you are protected. Keep in mind here that if tenants wish to give notice to vacate, they can do so with 14 days notice. The law says - it's the later of 14 days or the day the fixed term ends.

Parties can also end a tenancy earlier by mutual agreement, in writing. So remember, if you're claiming the Home or First Home Concession as a buyer for Transfer Duty, in order to be eligible, the tenants MUST be out the EARLIER of - 6 months from the settlement date or the end of the tenancy.  

AGENTS - if the buyers need possession fast, you can try to get a side agreement to remove a tenancy sooner, by incentivising them. For example - covering removal costs or a cash payment, etc.

Thanks to our very own Lohenay from our Manly office for this blog topic suggestion. 

We'll see you all next week for our last blog of 2023. 

Get in touch with us. Jump on our Instagram, our Facebook, our website.

George Souris. Empire Legal.

If you have any questions, you can email me: george@empirelegal.com.au. 

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Thanks for reading everybody. See you on the next one.

Ladies and gentlemen, please keep in mind that all advice is general in nature and does not constitute legal advice. This is authorised by George Sourris, Empire Legal, Gold Coast, Queensland, Australia.

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Note: all information is general in nature and as each matter is unique please contact our office for tailored advices: the above does not constitute legal advice.