How smoke alarm compliance can impact your property sale
When it comes to buying a home, there are numerous considerations that potential buyers need to take into account. One often overlooked aspect is whether the property's smoke alarms are compliant with local regulations. In this article, we will explore how buyers can claim adjustments for non-compliant smoke alarms and what steps they should take to ensure compliance.
Disclosure Requirements
Under current real estate contracts, it is the seller's responsibility to disclose whether the smoke alarms in the property comply with the Smoke Alarm Requirement Provision. This provision is in place to ensure that properties have functioning smoke alarms, which are essential for the safety of the occupants.
Non-Compliance Consequences
If the seller checks the "not compliant" box on the contract, they are obligated to rectify the situation by installing the correct smoke alarms to make the property compliant before the settlement date. Failure to do so can have financial implications for the seller.
In such cases, the buyer is entitled to an adjustment at settlement, amounting to 0.15% of the purchase price. This adjustment serves as compensation for the buyer's potential inconvenience and the cost of installing compliant smoke alarms themselves.
Claiming the Adjustment
To claim this adjustment, buyers must follow a specific procedure outlined in the contract. According to Condition 7.8 of the contract, buyers must make their claim in writing on or before the settlement date. It's essential to adhere to this timeline, as missing the deadline may result in the forfeiture of this entitlement.
Buyer's Responsibility for Compliance
While the seller must disclose the compliance status of the smoke alarms, proving compliance falls on the buyer. Buyers have a couple of options to establish compliance:
Compliance Certificate: Buyers can request a compliance certificate from the seller. Although sellers are not legally obligated to provide this certificate, it is often in their best interest to do so to avoid potential complications.
Inspection: Alternatively, buyers can choose to complete a smoke alarm inspection themselves. This entails ensuring that the smoke alarms in the property meet local safety standards. If any issues are discovered during the inspection, the buyer can use this as evidence to support their claim for an adjustment.
Non-Disclosure Issues
It's crucial for sellers to accurately disclose the compliance status of smoke alarms in the contract. Failing to do so can result in non-disclosure issues, which may lead to more significant consequences for the seller.
If smoke alarm compliance is not disclosed correctly, it can trigger further rights for the buyer. These rights might include the option to terminate the contract or seek additional compensation for the non-disclosure.
In conclusion, smoke alarm compliance is a critical aspect of any real estate transaction. Buyers should be aware of their rights and the steps they need to take to claim adjustments in case of non-compliance. Sellers, on the other hand, should be diligent in disclosing the status of smoke alarms to avoid potential legal complications. Ensuring compliance with safety regulations benefits everyone involved in the property transaction, ultimately contributing to the safety and well-being of future occupants.
Thank you to Rebecca Petroff from Sunstate Conveyancing for sharing this very important information with us.
