While these clauses are designed to offer protection, they’ve also sparked concern due to potential misuse. So, what exactly are they – and how can you protect yourself?
What is a sunset clause?
A sunset clause is a provision in a property contract – typically in off-the-plan sales – that sets a deadline (the ‘sunset date’) by which the development must be completed and the title registered.
If this deadline isn’t met, either party —the buyer or the developer—may have the right to terminate the contract.
These clauses are designed to protect both sides:
- Buyers can walk away if the project is significantly delayed.
- Developers can terminate if buyers are unreasonably delaying the settlement or if the project becomes unviable due to issues like labour shortages, escalating construction costs, or developer insolvency.
Where do sunset clauses exist?
You’ll typically find sunset clauses in:
- off-the-plan land contracts
- new house and land packages
- community title schemes like high-rise apartments.
What protections are available for buyers
Reforms introduced to-date represent a significant step forward in strengthening protections for buyers by ensuring sunset clauses are used fairly and transparently. While the current changes apply to land sale contracts, there is growing industry support to extend similar safeguards to community title schemes, such as apartment developments.
We welcome this support to enhance consumer confidence and fairness in Queensland’s building and construction industry.
What role does the QBCC play?
We play a vital role in upholding Queensland’s building standards by administering legislation designed to protect consumers and support industry integrity. While we don’t write laws or directly regulate contract clauses, we do actively collaborate with industry partners to advocate for reforms that enhance transparency and fairness, in the industry.
For property owners navigating sunset clauses, we play a vital role in:
- licensing and monitoring builders and tradespeople (excluding electricians, who are licensed by Queensland’s Electrical Safety Office) investigating complaints related to defective or incomplete work
- educating property owners about their rights and responsibilities.
If you’re facing delays or issues during construction, and can’t resolve them directly with your contractor, we can:
- facilitate dispute resolution
- direct the contractor to rectify defective work.
We encourage buyers to:
- seek legal advice before signing any contract
- review disclosure statements carefully, which must include details about the proposed lot and development works
- maintain open communication with developers to avoid misunderstandings and disputes.
Tips for property buyers
Read the fine print: Understand the sunset clause terms and how they can be triggered.
Ask questions: Maintain open communication with the seller/developer and clarify timelines, risks, and what happens if delays occur.
Get legal advice: A property lawyer can help you assess the fairness of a sunset clause and navigate other disclosures and contract terms.
Monitor progress: Stay informed about the development’s status and any changes, including via the QBCC licensee register.
More information
Visit our Home Owner Hub for your five-step guide to building and renovating in Queensland, including understanding contracts and our role as Queensland’s building and construction regulator
