# The REIQ contract for houses and residential land: what each clause does
Most Queensland homes change hands on one standard contract. A clause-by-clause tour of the deposit, conditions, settlement, warranties and default terms, in plain words.
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Almost every house, unit and block of residential land sold by private treaty in Queensland changes hands on the same document. It is published jointly by the Real Estate Institute of Queensland and the Queensland Law Society, it runs to many pages of small print, and most buyers and sellers meet it for the first time on the day an agent asks them to sign.
Knowing in advance what the contract's main parts do makes that moment much less daunting. The document is also more balanced than its length suggests: it was written by the body that represents agents and the body that represents solicitors, and most of its clauses exist because something once went wrong in a sale and the drafters wanted a clear answer the next time.
This guide walks through the contract in the order a sale unfolds: the reference schedule, the deposit, the two standard conditions, settlement, risk, the seller's warranties, adjustments and default. It gives clause numbers where a published source confirms them, explains what each clause is for, and points out where the outcome depends on what is written into a particular copy. It is a general description, not advice on any one contract.
1st editionof the combined residential contract, in use since 1 August 2025
5 business daysstatutory cooling-off period noted above the signature
5pmthe hour most contract deadlines expire
Queensland Law Society (Proctor, July 2025) and Queensland Government home-buying guidance.
## One contract where there used to be two
For decades there were two residential forms. Houses and vacant residential blocks were sold on the Contract for Houses and Residential Land. Units and townhouses were sold on the Contract for Residential Lots in a Community Titles Scheme. The Law Society's records show the last versions of each, the 19th and 15th editions, were released on 7 June 2024.
On 1 August 2025, the day Queensland's seller disclosure scheme began, both were replaced. The Law Society's journal, Proctor, reported that the new Contract for the Sale and Purchase of Residential Real Estate, first edition, combines the two older forms into one, and that it was drafted to line up with the Property Law Act 2023. Many people still call it the houses and land contract, and for a freestanding house the substance is familiar. What changed is the layout: the reference schedule was reformatted so that community titles information sits inside it, and a schedule for residential tenancies was added for properties sold with a tenant in place.
Proctor's guidance on the changeover was that the new form applies to contracts made from 1 August 2025. A sale signed by both parties before that date stayed on the older editions and outside the new disclosure rules.
One consequence matters when reading older explanations of the contract. Clause numbers move between editions. The numbers in this guide come from the Law Society's commentary on the current edition where it gives them, and from published solicitors' summaries of the 2022 editions where it does not. The copy in front of a buyer or seller is always the one that counts.
Before reading on
Clause numbers shift between editions
The edition is printed on the contract. If a number quoted here does not match the heading beside it in a given copy, trust the copy. The subject matter of each clause has been far more stable than its numbering.
## The reference schedule: where the deal is written down
The first pages are a form, not prose. The reference schedule records everything specific to the sale: the parties, the property, the price, the deposit and who holds it, the settlement date, and the dates on which the conditions fall due. The standard terms that follow are the same in every sale and take their meaning from what the schedule says.
The Queensland Law Handbook, published by Caxton Legal Centre, stresses that the schedule should be checked line by line before signing. It records what is included in the sale beyond the land itself, such as fixtures and chattels, any encumbrances the property is sold subject to, such as an easement, and any tenancy. An item left off the schedule is not part of the bargain simply because it was mentioned at an inspection.
Blank boxes matter as much as filled ones. The finance condition, for example, only operates if the schedule names the finance amount, the financier and the finance date. Leave those blank and the contract is not subject to finance, whatever was said in conversation. The Queensland Government's home-buying guidance makes the same point about every condition: a buyer must check that it actually appears in the contract at signing, because otherwise it has no legal force.
Since the 2025 edition the schedule also carries items that used to live elsewhere. Proctor's summary lists a condition allowing inspection of body corporate records, and a choice of three ways to treat land tax at settlement. Both are covered below.
## The deposit: clause 2
The deposit is the buyer's earnest money. The schedule says how much it is, whether it is paid in one amount or two, when each part is due and who holds it, usually the seller's agent in a trust account. The Queensland Government's guidance says deposits typically fall due within two or three days of the contract becoming binding, depending on its terms, and that money handed over with an offer before both parties have signed does not reserve the property.
The deadline is the part people underestimate. Law firm Attwood Marshall, writing in April 2026, described payment of the deposit on time as an essential term of the standard contract, with time of the essence. A seller whose buyer pays late can be entitled to terminate, keep the deposit and claim any loss on resale.
The courts have enforced that strictly. In a Supreme Court case reported by Real Estate Business in March 2026, a buyer under a $985,000 contract owed a 10 per cent deposit of $98,500. A bank transfer limit meant the money went across in instalments over two days. The agent had replied by text that this was acceptable. The seller terminated, and the court held the deposit was forfeited, because the agent had no authority to extend the deadline on the seller's behalf.
The contract has been adjusted to deal with the mechanics of electronic payment. Sunshine Coast firm Bradley Bray Lawyers, summarising the editions that took effect on 20 January 2022, explained that clause 2.1 treats a deposit paid by electronic transfer as paid when the transfer is made and proof is given, not when the funds clear, and that the clause builds in a short notice step before a seller can end the contract over a late electronic payment. That softens the edge without removing it. The safest reading of clause 2 is the simplest one: the date in the schedule is the date.
## Finance and inspections: clause 4
Two conditions are built into the standard terms and switched on by the schedule.
Clause 4.1 makes the contract subject to the buyer obtaining finance. The Queensland Law Handbook explains that the buyer must take reasonable steps to get approval on satisfactory terms; a buyer cannot use the clause as a free exit by never applying for a loan. By the finance date the buyer tells the seller one of two things: finance is approved, or it is not and the contract is at an end. A buyer who is still waiting on the lender needs the seller's agreement to a later date, and that agreement needs to be clear and to come from the seller.
Clause 4.2 makes the contract subject to building and pest inspection reports. The buyer arranges the inspections and, if the reports are unsatisfactory, may terminate by giving notice by 5pm on the inspection date. The handbook's description is that the reports must be obtained in writing, and the condition is tied to what they show.
Both clauses share a design: a date, a 5pm deadline, and a notice. What the notice must say and what happens if none is given are set out in the clause, and the outcome can differ depending on which party is silent. This is the part of the contract where a diary entry does the most work.
These standard conditions sit alongside, and are different from, the statutory cooling-off period. Queensland Government guidance says the standard contract comes with a cooling-off period of five business days that starts when the buyer receives a copy signed by both parties, and ends at 5pm on the fifth day. A buyer who withdraws in that window gets the deposit back within 14 days, less a penalty of up to 0.25 per cent of the price. There is no cooling-off period for a property bought at auction. The contract must carry a warning about the period directly above the place where the buyer signs.
## Settlement: clauses 5 and 6
Settlement is the exchange: the balance of the price for a registrable transfer and possession. Clause 5 lists what each side must do. Proctor's notes on the 2025 edition refer to clause 5.5(1) as the provision setting out what the seller hands over at settlement, and to sub-paragraph (f)(i) of it as the place where the pool compliance certificate is dealt with. Keys, a release of any mortgage and vacant possession, or the tenancy documents if the property is sold tenanted, belong to the same list.
Clause 6 is about time. The contract says time is of the essence, which means a deadline is a deadline: a party who is not ready on the settlement date is in default, and the other may be entitled to terminate. For years that made a failed bank transfer or a missing document on settlement afternoon a genuine emergency.
Two provisions now soften that. Bradley Bray's summary of the 2022 changes describes clause 6.2, which lets either party extend the settlement date by up to five business days by giving written notice before 4pm on the day settlement was due. It was introduced to deal with delays outside a party's control, and it does not require the other side's consent. Proctor's summary of the 2025 edition adds clause 6.3, a new automatic extension that applies where the sale is settling by electronic conveyancing.
Neither clause turns the settlement date into a suggestion. An extension under clause 6.2 has a ceiling, and once it is used up the original rule applies again. Conduct also counts. In a 2025 Supreme Court decision summarised for the REIQ by Carter Newell Lawyers, sellers under a $3,264,000 contract tried to treat it as ended over a deposit instalment paid two days late, after replying warmly to the buyers' messages and allowing them access to the property. The court held the contract had not been validly terminated and ordered the sale to proceed. The lesson the REIQ drew for agents was that informal texts and calls can change the parties' legal position.
The life of a standard contract
Both parties signThe contract is binding. The cooling-off period starts when the buyer receives the signed copy.
Deposit dateThe deposit is paid to the stakeholder named in the schedule.
Inspection dateThe buyer gives notice on building and pest by 5pm.
Finance dateThe buyer confirms finance, or ends the contract under clause 4.1.
Settlement datePrice and title are exchanged, unless time is extended under clause 6.
## Risk and insurance from day two
One of the contract's less intuitive rules concerns who bears the risk of damage between signing and settlement. The Queensland Law Handbook states it directly: the property is at the buyer's risk from 5pm on the first business day after the contract is made. The seller still owns the house and still lives in it, but if it is damaged after that point the buyer is generally still bound to complete.
That is why the Queensland Government's guidance says a buyer should, in most cases, take out home insurance from the contract date, and why lenders usually ask for proof of cover before settlement. For a unit, the building itself is insured by the body corporate, which is one reason the buyer's insurance position in a community titles scheme differs from a house.
The seller's side of the bargain is to hand over the property in the condition it was in when the contract was signed, fair wear and tear excepted, and to allow the buyer a pre-settlement inspection. Whether an appliance that fails in the meantime must be repaired is the kind of question the schedule's list of included chattels helps to answer.
## What the seller promises: clause 7
Clause 7 holds the seller's warranties, the statements the seller stands behind about the property and the title. They are easy to skim and they carry real consequences, because a breach of several of them gives the buyer a right to terminate or to claim compensation.
The table lists the sub-clauses that published commentary identifies by number.
Inside clause 7Sub-clauses identified in published commentary
Clause
Subject
What the seller is saying
7.4
Warranties
No undisclosed notices or orders; nothing known that may lead to a contaminated land listing.
7.5
Survey and mistakes
The buyer may terminate for a material error in the boundaries or description; lesser errors give compensation only.
7.7
Transport, resumption, access and services
The buyer may terminate if a transport proposal or resumption notice affects the lot, access is unlawful, or services cross other land without an easement.
7.9
Smoke alarms
Compliant alarms will be installed by settlement.
Source: Queensland Law Society seller disclosure FAQs (Proctor, July 2025) for 7.4 and 7.7; REIQ and Queensland Law Society residential contract, first edition, for 7.5; Bradley Bray Lawyers' summary of the 2022 editions for 7.9.
Two features of clause 7 deserve attention since the disclosure scheme began. The first is that the contract's warranties and the statutory disclosure statement overlap without being identical. The Law Society's FAQs for practitioners point out that clause 7.7(1)(b) is wider than the equivalent question on Form 2: the form asks only about transport proposals the seller has received a notice of, while the warranty reaches proposals whether or not a notice was given. Likewise clause 7.4(1)(e) and (f) require the seller to disclose facts that may lead to land being classified as contaminated in future, which goes beyond the form. A seller can therefore complete Form 2 accurately and still be in breach of the contract.
The second is the remedy. The FAQs note that a buyer keeps the contractual right to terminate or claim compensation for a breach of the clause 7.4(1) warranties, separately from the rights the Property Law Act gives for defective disclosure. The Law Society adds that these warranties can be removed by special condition, which is one reason to read the special conditions as carefully as the standard ones.
On smoke alarms, Bradley Bray's summary explains how the contract backs the warranty with money: if compliant alarms are not installed by settlement, the buyer is entitled to an adjustment of 0.15 per cent of the purchase price, and the contract lets the buyer inspect before settlement to check. On a $750,000 sale the adjustment is $1,125.
## Adjustments, land tax and GST
The adjustments provisions share the property's running costs between the parties as at the settlement date. Council rates and, for a unit, body corporate levies are apportioned so that each side pays for the days it owns the property. Rent is adjusted the same way when a tenant stays on.
Land tax has always been the awkward item, because a seller's land tax bill can depend on what else the seller owns. Proctor's summary of the 2025 edition says the reference schedule now gives the parties three options: no adjustment at all, an adjustment calculated as if the property were the seller's only land, or an adjustment based on the seller's actual liability. The choice is made by ticking a box, so it is worth a moment's thought before signing.
GST rarely arises in the sale of an existing home between private individuals, but it can in the sale of new residential premises or vacant land by a developer. The 2025 edition, Proctor notes, includes detailed GST provisions in clause 10. A buyer of a new house or a block in an estate should expect those provisions to be in play.
For lots in a community titles scheme, the combined contract carries the provisions that used to sit in the separate units form. Proctor's notes mention clause 12.4, where the term Scheme Land replaced an older expression, and the new schedule item allowing the buyer to inspect body corporate records. These work alongside the body corporate certificate the seller must now give before signing.
## Default: what happens when someone does not perform
The default clause is the contract's enforcement mechanism. If the buyer fails to pay the deposit or does not settle, the seller has a choice: affirm the contract and sue for the sale to be completed, or terminate. On termination the seller can keep the deposit, resell the property and claim any shortfall and costs from the buyer, as Attwood Marshall's summary of the deposit rules sets out. A missed finance or inspection notice is different: the seller may end the contract, and that is the seller's only remedy.
If the seller is the one in default, the buyer has the mirror-image choice: terminate and recover the deposit, or affirm and ask a court for specific performance, the order that makes the sale go ahead.
Money paid late under the contract attracts interest at the contract's default rate. The Queensland Law Society publishes the current default interest rate for the standard contracts, and the schedule has a box where the parties can substitute their own.
Termination is a formal step with formal requirements. It has to be communicated clearly, by the right party, for a reason the contract or the general law recognises. A party who terminates without the right to do so may themselves be the one in breach. The two court cases described earlier point in opposite directions on their facts and to the same conclusion: what the contract says, and what the parties themselves say and do, decide the outcome.
## Special conditions, signatures and reading a copy
The last part of the contract is the space for special conditions. Anything the parties have agreed that the standard terms do not cover goes here: a sale subject to the buyer selling another property, a longer settlement, repairs before completion. The Law Society's instruction to its members is that changes should be made by adding special conditions, not by altering the printed terms. The REIQ's own guidance to agents, given when it released a related contract in 2023, is that agents should refrain from drafting special terms and leave them to legal practitioners.
Signing is commonly electronic. Bradley Bray's summary notes that the definition of the contract date was updated in 2022 to accommodate electronic signing through the REIQ's forms platform. Whether signed on paper or on screen, the contract binds only when both the buyer and the seller have signed, as the Queensland Government's guidance puts it. Since 1 August 2025 one more step comes first: the seller's disclosure statement and certificates must be in the buyer's hands before the buyer signs.
> The standard terms are the same in every sale. What differs is the schedule at the front and the special conditions at the back, and those are the pages to read twice.
A sensible way to read a copy is therefore back to front. Start with the special conditions, because they override the standard terms. Then check every box in the reference schedule against what was agreed. Then note each date in a calendar with its 5pm deadline. The printed clauses in between are the rules of the game, and this guide's short version of them is no substitute for the document itself or for advice on it.