From 1 January 2010, every seller of a house, townhouse or unit must complete a “Sustainability Declaration” before the property is marketed or offered for sale.

This brand new green-tape requirement comes about by way of a new Chapter 8A in the Building Act of 1975 and a new Part 5 of Chapter 11 of the Property Agents and Motor Dealers Act 2000.

The purpose of the declaration is to inform buyers of the environmental sustainability qualities of the residence including the safety, access, water and energy efficiency of the property and to act as an incentive to sellers to improve such features.

Agents must obtain declarations for all residences that they market, including current listings, by 1 January.

The declaration which can be completed by anybody but must be signed by the seller or his/her Power of Attorney, takes the form of a checklist.

As a matter of risk management, it is preferable for agents to require that the seller personally complete the declaration.

The form must be completed to the best of the seller’s ability and knowledge i.e. if the seller cannot reasonably find out information or has no technical knowledge about the feature, then that specific item can be left blank.

The seller’s agent is not obliged to provide a copy to every prospective purchaser, but if asked must give the person a copy as soon as practicable.

Whenever a home is open for inspection a copy of the declaration must be available and conspicuously displayed in a position so that anybody entering the home can easily read it.

If a prospective purchaser enters the home at any other time other than at an open-for-inspection time:

the person must first be given a copy; or
a copy must be readily available and the buyer notified before, that a copy is available; or
a copy must be conspicuously displayed so that the person can easily see and read it.

Non-compliance may lead to a financial penalty.

If a home is upgraded during the marketing period or the seller realises that the declaration is incorrect, the declaration can be amended by initialling and dating the change or a new declaration can be completed and signed.

Advertising

All agents and private sellers must state where a copy of the sustainability declaration can be obtained in all advertisements for the sale of a property eg brochures, online listings, window displays etc but not in newspaper or magazines ads or in generic “For Sale” signs. Website ads may contain a link to the declaration for the particular property.

Compensation and termination

Section 246l of the Building Act provides the seller may be liable to compensate the buyer for the loss or expense incurred due to false or misleading information in the declaration. However, both the Building Act and PAMDA specify that there is no right to terminate a contract in respect of any declaration that is incomplete or false.

Consequences of non-compliance

Failure to comply with the advertising requirements could lead to a maximum fine of up to $10,000.