In short: A Section 32 vendor statement is the disclosure document a Victorian seller must give you before you sign a contract of sale. It covers title, mortgages, easements, zoning, rates, services, building permits, owners corporation details and notices from authorities. If it is missing, false or incomplete you may be able to rescind the contract before settlement.
Every property sold in Victoria comes with a Section 32, and it is usually the first thing a conveyancer opens. Read properly, it tells you what you are actually buying, and it often flags the issues that will trouble a lender's valuer later. Here is what the law requires, what it doesn't, and how to use it.
What the law says
The name comes from section 32 of the Sale of Land Act 1962 (Vic). The vendor must give the purchaser the statement, signed by the vendor, before the purchaser signs the contract. Sections 32A to 32I set out the categories of information that must be included, and section 32K sets out what happens when the vendor gets it wrong.
The statement must disclose:
- Title and ownership. A copy of the register search and plan, showing the registered owner, mortgages, caveats, easements, covenants and any other registered restrictions.
- Financial matters. Rates, taxes, charges and other outgoings, and any amounts owing. If the land is affected by an owners corporation, the owners corporation certificate and rules.
- Planning. The planning scheme and zone, any overlays, and whether the property is in a designated bushfire-prone area.
- Services. Which of electricity, gas, water, sewerage and telephone are connected.
- Building permits. Details of building permits issued in the preceding 7 years, and for owner-builder work, the required defects report and insurance details.
- Notices and orders. Any notice, order, declaration, report or recommendation from a public authority or government department that directly affects the land, and any notice of intention to compulsorily acquire.
- Land in a growth area. Whether a growth areas infrastructure contribution applies, which is relevant across Melbourne's northern corridor.
Section 33B also requires the vendor's agent to make the Consumer Affairs Victoria due diligence checklist available to buyers, which is a separate document from the Section 32.
Rescission for a defective statement
Under section 32K, if the vendor fails to give the statement, or it contains false information or omits required information, the purchaser may rescind the contract at any time before settlement. The vendor can resist rescission only if they can show they acted honestly and reasonably and ought fairly to be excused, and that you are in substantially as good a position as if the statement had been correct. Courts apply this seriously, but relying on it is a last resort compared with reading the document first.
What a Section 32 does not tell you
The gaps matter as much as the contents:
- It is not a building or pest report, and there is no obligation on the vendor to disclose structural defects, damp or termites.
- It does not warrant that the boundaries match the fences. A survey may be needed.
- It does not verify that renovations were permitted unless a permit was issued in the last 7 years.
- It does not tell you what the property will value at, which is what your lender cares about.
That is why the Section 32 is paired with a building and pest inspection and a lender valuation.
How to review a Section 32 step by step
- Get it early. Ask the agent for the Section 32 before you inspect a second time. Reviewing it before an auction is essential, because auction sales are unconditional and have no cooling-off period.
- Check the vendor is the registered owner. Mismatches usually mean a deceased estate, a company sale or a sale by a mortgagee, each of which changes the contract dynamics.
- Read the title diagram. Easements for drainage or sewer can rule out a future extension or a granny flat. Covenants can restrict materials, fences and the number of dwellings.
- Check the zone and overlays. A Development Plan Overlay or Design and Development Overlay in a new estate can affect what you can build. A heritage or flood overlay will interest your lender.
- Look at the owners corporation certificate. For townhouses and apartments, review fees, insurance, the maintenance fund and any special levies or litigation. Our owners corporation guide explains what to look for.
- Check rates and outgoings. These feed straight into your household budget and your lender's serviceability assessment.
- Look for notices. Road widening, compulsory acquisition, building orders and fire safety notices all belong here.
- Hand it to your conveyancer. A professional review in Melbourne is inexpensive against the size of the purchase.
What each disclosure means for your purchase
| Section 32 item | Why it matters | Who checks it |
|---|---|---|
| Title search and plan | Confirms ownership, easements, caveats, mortgages | Conveyancer |
| Zoning and overlays | Controls use and future building work | Conveyancer, you |
| Rates and outgoings | Ongoing cost, adjusted at settlement | Conveyancer, lender |
| Building permits (7 years) | Reveals unapproved work | Building inspector |
| Owners corporation certificate | Fees, levies, disputes, insurance | Conveyancer, lender |
| Notices and orders | Compulsory acquisition, building orders | Conveyancer |
| Bushfire-prone area | Building standards and insurance cost | Insurer, lender |
Worked example
You are looking at a $720,000 house in Mickleham. The Section 32 shows a 3 metre drainage easement along the rear boundary, a Development Plan Overlay from the estate's approval, and a building permit issued 4 years ago for a pergola. Rates are about $2,400 a year and there is no owners corporation.
None of this is a deal-breaker. The easement means the pergola can't be extended over the rear strip, and the overlay is standard for a growth-corridor estate. You note the rates in your budget, your conveyancer confirms the pergola permit has a final inspection, and you proceed. If the same statement had instead revealed a notice of intention to acquire part of the frontage for a road upgrade, you would have grounds to renegotiate or walk away before signing.
What it means for your home loan
Lenders don't read the Section 32, but their valuers and their credit assessors react to the things it reveals:
- Title restrictions such as caveats or unusual covenants can delay settlement until they are cleared. Our page on caveats on property explains why.
- Owners corporation fees are counted as an expense in your serviceability calculation, along with rates. Use our borrowing power calculator to see the effect.
- Bushfire and flood overlays can push up insurance premiums, and a lender will require building insurance from settlement.
- Small lot sizes or unusual zoning can affect the lender's willingness to lend at a high LVR.
When GNT Finance reviews your situation, we ask for the Section 32 early so we can match you with a lender that is comfortable with the property, not just your income. Gorakh Timilsina's years as a senior credit officer mean he has seen exactly which title issues cause an assessor to hesitate. Our home-loan service is at no cost to you in most cases.
Common mistakes
- Not reading it before auction. Once the hammer falls, any surprise in the Section 32 is your problem unless section 32K applies.
- Assuming it covers building condition. It doesn't. Book an inspection.
- Ignoring the owners corporation certificate. A special levy of thousands of dollars can be waiting for the new owner.
- Skipping the planning certificate. Overlays affect resale and future development.
- Treating an old Section 32 as current. If the vendor updated the statement after a failed sale, make sure you have the latest version.
Frequently asked questions
What is a Section 32 in Victoria?
A Section 32 is the vendor statement required by section 32 of the Sale of Land Act 1962 (Vic). The seller must give it to you before you sign the contract of sale. It discloses the title, mortgages, easements, covenants, zoning, rates, services, building permits from the last 7 years, owners corporation details and any notices from authorities affecting the property.
Can I pull out of a contract if the Section 32 is wrong?
Possibly. Under section 32K, if the statement was not given, or contains false or missing information, you can rescind before settlement. The vendor can defend the rescission only by showing they acted honestly and reasonably and that you are in substantially as good a position anyway. Get legal advice quickly, because delay can weaken your position.
Does a Section 32 include a building inspection?
No. The vendor is not required to disclose defects, and the statement says nothing about structural condition, plumbing, roofing or pests. It only lists building permits from the previous 7 years and owner-builder insurance where relevant. Arrange your own building and pest inspection before you sign or before auction day.
How long is a Section 32 valid for?
The Act does not set an expiry date, but the statement must be accurate at the time you sign the contract. If rates, title details or owners corporation information have changed since it was prepared, the vendor should update it. Ask for the date it was signed and have your conveyancer check whether anything has moved since.
Who prepares the Section 32 and who pays for it?
The vendor's conveyancer or solicitor prepares it and the vendor pays. Buyers pay their own conveyancer to review it. Reviewing a Section 32 before an auction is a normal part of due diligence, and most Melbourne conveyancers charge a modest fee for a pre-auction review that is credited against the full conveyancing fee if you buy.
Talk to GNT Finance
Send us the Section 32 before you commit and we'll tell you which lenders will be comfortable with the property, how the outgoings affect your borrowing capacity, and what pre-approval you need in hand. Book a free consultation or call 0426 403 703.
This page is general information only and not legal, tax or financial advice. Laws change — confirm current rules with the State Revenue Office, the ATO or a licensed professional.
Written by Gorakh Timilsina
Founder, CEO & Senior Mortgage Consultant at GNT Finance. Gorakh started as a broker assistant, spent years as a senior credit officer assessing loan applications, and now helps Melbourne families get the right loan approved. English, Nepali and Hindi spoken.