Buying a property is a major decision.
Sometimes, a buyer signs a Contract of Sale and then has second thoughts.
Perhaps the buyer has reconsidered the price, changed their financial plans, discovered another property they prefer, or simply feels that they no longer want to proceed.
So, can a buyer change their mind after signing a property contract in Victoria?
The answer depends on how and when the property was purchased, whether the buyer still has a cooling-off right, and what the Contract of Sale says.
In some circumstances, a buyer can legally withdraw from the purchase. In others, simply changing your mind does not give you a right to cancel the contract.
This article explains what Victorian buyers should know before deciding what to do.
When Is a Property Contract Binding in Victoria?
For a private property sale, the property is generally sold when both the buyer and seller have signed the Contract of Sale.
Once both parties have signed, the contract is generally binding and the buyer should not assume they can simply walk away.
However, Victorian law provides a cooling-off right for certain private residential and small rural property purchases.
Consumer Affairs Victoria states that a buyer has three clear business days to cool off from a private sale, subject to specific exceptions.
This means there is an important difference between:
“I have changed my mind and I am still within my cooling-off period.”
and
“I have changed my mind but my cooling-off period has already ended.”
The legal position can be very different.
Can a Buyer Cool Off After Signing a Contract?
For a qualifying private sale of a residential property or small rural property, the buyer generally has a three-clear-business-day cooling-off period.
The cooling-off period starts from the date the buyer signs the contract, not the date the seller signs it.
If the buyer decides not to proceed during the cooling-off period, they must give written notice to the seller or the seller’s agent.
The buyer is generally entitled to a refund of money paid, less $100 or 0.2% of the purchase price, whichever is greater.
Example
You sign a private sale contract on Monday.
If the purchase qualifies for cooling off, the three-clear-business-day period begins from the date you sign.
If you decide on Tuesday that you no longer want to purchase the property, you may still be able to exercise your cooling-off right, provided you comply with the legal requirements and the cooling-off period has not expired.
When Does Cooling Off Not Apply?
Cooling-off rights do not apply to every property purchase.
Consumer Affairs Victoria identifies several situations where a buyer cannot cool off, including when:
- the property was purchased at a public auction
- the property was purchased within three clear business days before or after a public auction
- the property is mainly used for industrial or commercial purposes
- the property is more than 20 hectares and used mainly for farming
- the buyer has previously signed a contract for the same property with the same terms
- the buyer is an estate agent or corporate body.
This is why buyers should not assume that every property purchase automatically comes with a cooling-off period.
What If I Bought the Property at Auction?
If you purchased the property at auction, there is no cooling-off period.
Consumer Affairs Victoria states that a buyer who purchases a property at auction cannot cool off after signing the contract.
This is one of the reasons buyers should complete their due diligence before bidding.
Before an auction, consider reviewing:
- the Contract of Sale
- the Section 32 statement
- title information
- property searches where appropriate
- owners corporation information, if applicable
- finance arrangements
- building and pest considerations
- any other matters relevant to the property
Once you successfully bid and the contract is signed, you should not assume that you can change your mind afterwards.
What If I Signed a Private Sale Contract but Cooling Off Has Ended?
This is where things become more complicated.
Once the cooling-off period has expired, simply changing your mind generally does not automatically give you a right to cancel the contract.
For example, a buyer might decide:
“I think I paid too much.”
or:
“I found another property I like more.”
or:
“I don’t think I want to move anymore.”
These reasons do not automatically mean that the buyer can walk away from a binding contract.
The buyer should first check the Contract of Sale and obtain appropriate advice about whether any contractual or legal right to end the contract applies.
What If My Contract Is Subject to Finance?
A contract can sometimes include a finance condition.
For a private sale, the buyer and seller can negotiate conditions such as obtaining loan approval. Consumer Affairs Victoria confirms that private-sale contracts can be made conditional on matters such as finance approval or a satisfactory building inspection.
However, a buyer should not assume that having a finance clause means they can cancel whenever they want.
The exact wording of the condition matters.
For example, the contract may specify:
- a particular lender
- a finance amount
- a finance approval date
- notice requirements
- what happens if finance is not approved
If you are concerned about finance, check the actual contract terms rather than relying on a general assumption that the purchase is automatically conditional.
What If I Have a Building and Pest Condition?
Some private-sale contracts may also include conditions relating to building or pest inspections.
If the contract contains such a condition, the buyer’s rights will depend on the specific wording and requirements of that condition.
For example, a condition may specify:
- when the inspection must occur
- what standard applies
- whether the buyer can terminate
- what notice must be given
- when the condition expires
A buyer should follow the contract carefully and obtain advice if the inspection identifies a problem.
A building or pest condition is not necessarily the same as having a general right to cancel the purchase simply because you have changed your mind.
What If I Just Don’t Want the Property Anymore?
This is one of the most common questions buyers ask.
If the cooling-off period has ended and there is no applicable contractual or legal right to terminate, simply deciding that you no longer want the property does not automatically end the contract.
For example:
You sign a contract to buy a house for $800,000.
Two weeks later, you decide you would rather buy another house.
You generally cannot assume that you can simply tell the seller:
“I’ve changed my mind. I don’t want to proceed.”
The seller may have contractual rights if the buyer fails to perform their obligations.
The consequences can depend on the terms of the contract and the circumstances of the breach.
What Happens If a Buyer Refuses to Settle?
If a buyer is required to complete the purchase but refuses to settle, there may be serious contractual and financial consequences.
Depending on the circumstances and the terms of the contract, issues may include:
- the deposit
- default interest
- additional costs
- notices of default
- termination rights
- potential claims for losses
The exact consequences depend on the contract and the circumstances.
If you no longer want to proceed with a purchase, it is much better to speak with your conveyancer or legal practitioner before settlement is due rather than simply failing to attend settlement.
Can the Buyer and Seller Agree to Cancel the Contract?
Sometimes the buyer and seller may agree to end a contract.
However, this should not be treated as an informal arrangement.
If both parties agree to terminate the contract, the agreement should be properly documented and the consequences considered.
There may be issues involving:
- the deposit
- expenses already incurred
- settlement arrangements
- release of the parties from their contractual obligations
- any compensation or other payment agreed between the parties
If you and the seller are discussing cancellation, speak with your conveyancer or legal practitioner before agreeing to anything.
What If I Discovered a Problem With the Property After Signing?
Changing your mind is different from discovering a contractual, disclosure or property issue after signing.
For example, you may discover:
- an issue with the title
- an unexpected easement
- an owners corporation issue
- a problem with the Section 32 statement
- a building or planning issue
- a problem with finance
- damage to the property
- another matter affecting the transaction
Do not automatically assume that the issue gives you a right to cancel.
Instead, provide the relevant documents and information to your conveyancer or legal practitioner so they can assess the position.
The appropriate response will depend on the particular circumstances and the terms of the Contract of Sale.
Can I Cancel Because I Found a Better Property?
Generally, finding another property you prefer does not by itself give you a right to cancel a binding property contract.
For example:
You purchase Property A on Monday.
On Wednesday, you see Property B and decide you like it more.
If your cooling-off period applies and has not expired, you may have a cooling-off right.
If the cooling-off period has expired, however, simply finding another property does not automatically release you from the original contract.
This is why buyers should take their time and consider the purchase carefully before signing.
What If I Have Not Paid the Deposit Yet?
Not having paid the deposit does not necessarily mean that there is no binding contract.
For a private sale, the property is generally sold when both parties have signed the Contract of Sale.
The deposit is an important part of the transaction, but buyers should not assume that the contract only becomes binding once the deposit has been paid.
If you have signed the contract and are unsure about your obligations, contact your conveyancer or legal practitioner promptly.
What Should Buyers Do Before Signing?
The best time to deal with concerns about a property is before signing the Contract of Sale.
Before signing, consider:
1. Review the Contract of Sale
Make sure you understand the price, settlement date, conditions and special conditions.
2. Review the Section 32 statement
Check the information provided about the property and title.
3. Consider finance
Make sure you understand your finance position and whether a finance condition is appropriate.
4. Consider building and pest inspections
If you want a building or pest condition, discuss it before signing.
5. Check important property information
Depending on the property, this may include:
- title
- easements
- owners corporation information
- planning information
- permits
- property searches
- other relevant documents
6. Ask questions before signing
If you do not understand a term in the contract, ask before signing rather than assuming it can be changed later.
7. Consider a contract review
A contract review can help identify important terms and special conditions before you commit to the purchase.
What If I Am Unsure Whether I Can Cancel?
If you have already signed a contract and are now unsure whether you can withdraw, do not simply stop responding to the seller or agent.
Instead:
- Check when you signed the contract.
- Determine whether you are still within the cooling-off period.
- Check whether the property was purchased privately or at auction.
- Review any conditions in the contract.
- Contact your conveyancer or legal practitioner promptly.
- Do not assume that you can cancel without consequences.
If you are still within a cooling-off period, timing can be important.
If the cooling-off period has expired, your conveyancer or legal practitioner can help you understand whether another contractual or legal right may apply.
Frequently Asked Questions
Can I change my mind after signing a property contract in Victoria?
Sometimes. If you purchased a qualifying residential or small rural property by private sale, you generally have three clear business days to cool off, subject to the exceptions under Victorian law. After the cooling-off period, simply changing your mind does not automatically give you a right to cancel.
How long do I have to cool off after buying a house in Victoria?
For a qualifying private sale, the cooling-off period is three clear business days. It starts from the date the buyer signs the contract.
Can I cool off after buying a property at auction?
No. There is no cooling-off period for a property purchased at auction.
Can I cancel because I found another property I like better?
Finding another property does not by itself give you a right to cancel a binding contract. If you are still within an applicable cooling-off period, you may have a cooling-off right. Otherwise, you should check the contract and obtain advice.
What happens if I refuse to settle?
Refusing to settle may put you in breach of the contract and could result in financial or legal consequences. The exact consequences depend on the contract and circumstances.
Can the seller agree to let me out of the contract?
The buyer and seller may be able to agree to terminate a contract, but any agreement should be properly documented and the consequences considered before you proceed.
Should I contact my conveyancer if I change my mind?
Yes. Contact your conveyancer or legal practitioner as soon as possible. In particular, if you may still have a cooling-off right or another contractual right, timing can matter.
Final Thoughts
Changing your mind after signing a property contract can be stressful, but the options available to you depend on the circumstances.
For a qualifying private sale, Victorian buyers generally have a three-clear-business-day cooling-off period, subject to exceptions.
After the cooling-off period has ended, simply changing your mind does not automatically give you a right to cancel the contract.
If you have already signed a contract and are having second thoughts, speak with your conveyancer or legal practitioner as soon as possible before taking any action.
Understanding your rights and obligations early can help you avoid unnecessary costs and complications.
Need Help With a Victorian Property Contract?
At Prox Conveyancing, we assist buyers with Victorian property transactions from contract review through to settlement.
If you are considering buying a property or have already signed a Contract of Sale and are unsure about your rights or obligations, contact Prox Conveyancing to discuss your situation.
About the Author
Meet Sally
Sally Kwok is a Licensed Conveyancer and the Director of Prox Conveyancing. With more than 16 years of experience in the conveyancing industry, she is committed to helping buyers and sellers navigate Victorian property transactions with confidence. Sally is passionate about providing clear communication, practical guidance and personalised service throughout every stage of the conveyancing process.
👉 Learn more about Sally on our About page.
About Prox Conveyancing
Prox Conveyancing is a Victorian conveyancing practice providing professional conveyancing services for residential property transactions across Victoria. We assist buyers, sellers, investors and families with a wide range of conveyancing matters, delivering personalised service, transparent communication and professional support from contract through to settlement.
👉 Learn more about Prox Conveyancing on our About page.
This article provides general information only and is not legal advice. Every property transaction is unique, and the information above may not apply to your particular circumstances. If you require advice about your specific situation, please contact a qualified legal professional or licensed conveyancer.