What’s Different About a Property Transfer Between Related Parties?

A full or part interest in a property can be transferred between related parties.  Examples of related parties include spouses, domestic partners, family members, friends, business associates or separating couples.

A transfer between related parties is unlike a standard purchase or sale in several respects:

• It is possible for us to act for both parties in the transaction, but only if both parties remain in consensus throughout the process.
• A contract is not used.  Contracts are used to enforce parties’ rights and provide remedies and sanctions if a party breaches the contract.  If one of the parties in a related party transfer does not fulfill one of its obligations, then the transfer simply does not proceed.
• Except for breakdown of relationship or “love and affection” transfers, the property being transferred needs to be valued by a licensed real estate agent or certified practising valuer.  The valuation is required for the assessment of stamp duty.

Please note that a transferee in a related party transfer can only receive stamp duty concessions or exemptions (such as those available to first home buyers) if the property is sold to them at valuation (i.e. at arm’s length), and evidence of the funds transfer between the parties’ bank accounts at settlement is produced.

For more information about transfers between related parties, please contact our experienced Melbourne conveyancer at 03 9815 2351.