Section 32 Victoria: What Property Investors Must Check Before Signing

Before you sign a contract of sale for any Victorian property, the vendor must give you a Section 32 Vendor's Statement. This document is your primary tool for uncovering problems the seller isn't volunteering. Most buyers glance at it and hand it to their conveyancer. That's not enough — especially if you're buying an apartment or strata property in Melbourne.

What the Section 32 Contains

The Section 32 (named after section 32 of the Sale of Land Act 1962) is a statutory disclosure document. Vendors are legally required to provide accurate information about:

• Title details: certificate of title, any caveats, easements, encumbrances, or covenants on the land
• Outgoings: council rates, water rates, owners corporation levies if applicable
• Planning and zoning information: any overlay controls, planning permits, or notices
• Building permits issued in the last seven years
• Any notices, orders, or requirements from councils or government authorities
• Owners corporation (body corporate) information for strata properties
• Vendor's disclosure on the nature of the property boundary and title

For investors, the sections that demand forensic attention are the owners corporation material and any building permit history.

The Owners Corporation Certificate: The Most Dangerous Document in the Stack

If you're buying an apartment, unit, or townhouse in a multi-lot building, the Section 32 must include a current Owners Corporation certificate. This is where the real financial risk hides.

The OC certificate legally mandates disclosure of:

Current levies and fee structure — what you'll be paying quarterly. Basic low-rise buildings typically run $400 to $800 per quarter. Mid-rise with lifts and parking run $800 to $1,500 per quarter. High-rise towers in the CBD, Southbank, or Docklands can run $1,800 to over $5,000 per quarter. These are recurring holding costs that directly reduce your net yield.

Proposed special levies — this is the landmine. If the OC has identified that the maintenance fund is underfunded for an upcoming capital work requirement (a roof replacement, lift overhaul, facade repair), it may have passed a resolution to raise a special levy. These can range from $5,000 to over $50,000 per lot. If you buy without spotting this, you inherit the liability.

Active litigation — check the AGM minutes carefully for any mention of VCAT disputes, building defect claims against developers or builders, or pending cladding rectification orders. A building involved in active litigation has an uncertain financial future. The legal costs are being drawn from the maintenance fund, and the outcome — whether a cash settlement or a court order to remediate — is unpredictable.

Cladding notices — Victorian law prohibits Cladding Safety Victoria from maintaining a public register of affected buildings for privacy reasons. The Section 32 is the mechanism through which combustible cladding disclosure occurs. Any building orders from the Municipal Building Surveyor requiring the removal of non-compliant cladding should appear here. If it doesn't appear and the building later turns out to be affected, the vendor may have breached their disclosure obligations under the Sale of Land Act — but that legal remedy provides cold comfort when you've already settled.

Building Permits: The Seven-Year History

The Section 32 must disclose all building permits issued in the preceding seven years. For investment properties, this reveals:

• Whether any modifications or additions were built legitimately under permit
• Whether required permits were never obtained (which creates a compliance problem that transfers to you on purchase)
• Whether there is any certificate of final inspection outstanding on recent works

An incomplete building permit history on a property doesn't mean it's a dealbreaker, but it requires investigation. Your conveyancer or a building inspector can follow up with the local council to determine whether the works are compliant or whether you'll face an enforcement notice down the track.

Engaging a Conveyancer in Melbourne: Costs and Process

Victorian property investors use either a licensed conveyancer or a solicitor to handle settlement. The choice depends on the complexity of the transaction.

For a straightforward purchase, a conveyancer is typically sufficient. Licensed conveyancers in Victoria handle the title search, review of the contract, preparation of transfer documents, and coordination of settlement funds. Conveyancing costs in Victoria typically range from $1,200 to $2,500 for residential investment properties, plus disbursements (title search fees, PEXA platform fees, search costs for zoning and council orders).

Solicitors charge more — often $2,000 to $4,000 — but bring broader legal knowledge for complex transactions involving trusts, off-the-plan contracts, or properties with unusual encumbrances or building issues.

For apartment purchases where you've identified OC concerns, cladding risks, or building defects in the Section 32 review, using a solicitor with property litigation experience is a prudent upgrade.

The Settlement Process in Victoria

Victorian residential settlements typically occur 30 to 60 days after the contract is signed. The process runs as follows:

1. Contract signed; Section 32 reviewed; cooling-off period runs for 3 business days (private sale only — no cooling-off at auction)
2. Buyer's conveyancer conducts title and property searches
3. Finance unconditionally approved
4. Building and pest inspection completed (for houses; pre-purchase strata report for apartments)
5. Stamp duty liability confirmed and funds arranged
6. Final inspection of the property (typically one or two days before settlement)
7. Settlement conducted electronically via PEXA (Property Exchange Australia)
8. Transfer of ownership registered with Land Registry Services

At settlement, the buyer's lender remits the loan funds, the buyer provides the balance of the purchase price plus adjusted outgoings, the vendor's mortgage (if any) is discharged, and title transfers electronically. Keys are typically released by the agent once funds clear.

What Goes Wrong: Common Investor Mistakes

The most costly mistakes in the Section 32 and conveyancing process are consistently:

Failing to read the OC AGM minutes and missing a proposed special levy or active building defect litigation. The AGM minutes are not part of the headline OC certificate — they're often buried in the appendices of the Section 32, and buyers skip them.

Assuming the building permit history is complete. Always confirm with your conveyancer that all permits mentioned have final certificates, and that no further works listed in the AGM minutes are being done without permits.

Not budgeting for settlement adjustments. At settlement, outgoings are adjusted between buyer and seller. If the vendor has prepaid council rates or water rates for a period beyond settlement, the buyer reimburses the proportional balance. These adjustments are typically $500 to $2,500 but can be higher, and they're payable on the settlement date.

The Victoria Investment Property Guide includes a Section 32 review checklist and a full due diligence framework for Melbourne strata acquisitions, covering both the legal document review and the practical steps to assess building quality and OC financial health before auction day.

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