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Conditional and Unconditional Contracts of Sale

Conditional and Unconditional Contracts of Sale

Conditional and Unconditional Contracts of Sale
A contract of sale sets out the terms and conditions agreed upon between the buyer and seller in a clear and concise manner. There are two types of contracts in the sale of a property: conditional or unconditional.

Conditional Contracts of Sale
A Conditional Contract means there are certain conditions that must be met before the sale of the property. Common conditions on a contract are:


  • Subject to finance to be approved *
  • Pest and building inspections to report no issues *
  • Pending existing property sale being finalised *

*  (Generally solicitors and conveyancers will only agree to exchange of Contract pending the prior approval to the above)


  • Sunset clause (If settlement has not taken place by the end date included in the clause, both parties are legally entitled to walk away from the sale contract)

There can also be other special conditions agreed upon by the buyer and seller such as requiring the house to be professionally cleaned; specific items being removed from the property; or certain maintenance being completed before settlement.

By including conditions in a contract, this can protect the buyer if those conditions are not met and they wish to withdraw from the Contract of Sale. The wording of conditions is extremely important to ensure your rights are protected. Due to this, any conditions on a Contract of Sale should be drafted by a solicitor/conveyancer.

All special conditions are said to be for the benefit of the person they protect and can be waived by that person at any time.

Once all conditions of the contract are met, the contract becomes unconditional and proceeds to the agreed settlement date. When a contract becomes unconditional, neither party can terminate the contract without incurring heavy penalties. 

Unconditional Contracts of Sale
As the name suggests, an Unconditional Contract means the contract doesn’t have any conditions that affect the fulfilment of the contract; ie. the buyer and the seller are legally obliged to follow through with the Contract of Sale.  You must be completely certain that you want to proceed with the contract ‘as-is’, before entering into an unconditional Contract of Sale.

As a seller, the benefit of an Unconditional Contract of Sale is that you have a level of certainty that the sale is going to go through.  As a buyer, an Unconditional Contract of Sale may mean that a seller is willing to accept a lower purchase price than if there were special conditions to be satisfied before the sale is finalised.

Conditional or unconditional – what should you do?
Essentially, it is whichever suits your needs during the sale of a property. Speak with your solicitor/conveyancer and have them review to contract before you sign.



  • What are conditional and unconditional contracts?
  • Types of contracts
  • Contracts of sale
  • Property contracts


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