BUYING OFF THE PLAN? WHAT YOU NEED TO KNOW ABOUT THE “SUNSET CLAUSE”
Sunset Clause in a Property Contract A common approach to buying property is to enter into an Off the Plan Contract for the purchase of a unit or house that has not yet been built. An Off the Plan Property Contract allows you to lock in a purchase price based on the current property market and settle the contract once the development is complete. In some circumstances, it may take years before the development process is complete and settlement can occur. However, you have the benefit of a purchase price negotiated years earlier in a potentially lower property market. In order to ensure an Off the Plan Contract does not continue for an indefinite period with no development occurring, a standard “Sunset Clause” may be included in the Contract. What is a Sunset Clause? A Sunset Clause is a provision that sets out the latest date by which the development must be completed. If the development is not completed within this time frame the contract ...