Major Property Law Reforms on the Horizon

Key Changes Proposed Under the Consumer Legislation Amendment Bill 2026 (Vic)

Victoria is preparing for one of the most significant updates to its property‑law framework in more than a decade.

The Victorian Government has introduced the Consumer Legislation Amendment Bill 2026 (Vic), signalling substantial reforms to the real estate and property sector from 1 June 2027, particularly through amendments to the Sale of Land Act 1962 (Vic).

The Bill has passed its second reading and is now before Parliament for debate ahead of its final passage. Although not yet law, the proposed changes will significantly affect conveyancing practice, especially around deposit handling and vendor statement timing. These reforms represent both an operational challenge and an opportunity to reset long‑standing practices.

1. Early Release of Deposit Money

Currently, vendors may seek early release of a purchaser’s deposit by issuing a section 27 statement. The Bill proposes to repeal section 27 and introduce new sections 26A and 26B, fundamentally reshaping this process.

Key proposed changes

• No early release of deposit funds unless the contract of sale contains a special condition expressly allowing it; and
• Agents will be prohibited from deducting commission or expenses from any deposit released early; these amounts must be recovered at settlement.

Practical implications

These reforms aim to reduce purchaser risk, particularly where vendors access funds early but fail to settle. They also place greater emphasis on contract drafting, requiring lawyers and conveyancers to carefully prepare and review any special conditions permitting early release.

Vendors may also experience increased pressure to accept shorter settlement periods, particularly where agents are comparing multiple offers.

2. Vendor Statement Timing Requirements

Vendor statements (commonly known as section 32 statements) currently need only be provided before a purchaser signs the contract. The Bill introduces strict timing obligations through amendments to sections 32, 32K, and 32L.

New timing requirement

A signed vendor statement must be available either digitally or in hard copy at least 14 days before:

• an auction date,
• a fixed sale date, or
• the date the contract is signed.

Failure to comply may give purchasers a right to terminate.

Practical implications

The reforms are intended to give purchasers more time for due diligence. However, they introduce a rigid timeline that vendors and their representatives will need to manage carefully.

Vendors will need to:

• plan auction and listing dates earlier, and
• notify their legal representatives promptly so that contracts and vendor statements can be prepared within the required timeframe.

What this means for clients

Vendors will need to plan sale timelines earlier and ensure their legal representatives have sufficient notice to prepare the vendor statement and contract within the required timeframe. This may affect how quickly properties can be listed or taken to auction.

Purchasers, on the other hand, will benefit from more time to review disclosures and obtain advice before committing to a transaction.

Next Steps

We will continue monitoring the Bill as it progresses through Parliament. In the meantime, vendors, agents, and practitioners should begin assessing how these reforms may affect upcoming transactions and consider adjustments to their processes and timelines. For more information contact our Property & Development team on 03 5273 5273 or email info@coulterlegal.com.au.