What the Melbourne buyers agent due diligence process really checks

Consumer Affairs Victoria publishes a due diligence checklist for home and residential property buyers, and every seller or estate agent must make copies of it available to potential buyers at any open for inspection, and either link the webpage or provide a copy on their website. It is free, it is short, and most buyers never read it.

It is not a marketing document. It names the specific issues that impose restrictions or obligations on a buyer: urban living impacts such as noise, traffic and odours; owners corporation requirements and fees; growth area infrastructure contributions; flood and bushfire risk; rural obligations including weeds, native vegetation and pest animals; mining and earth resource activity; soil and groundwater contamination; land boundaries and surveys; planning controls and zoning restrictions; building safety, permits and heritage requirements; connections for water, electricity, gas and internet; and buyers’ legal rights under the contract.

Treat it as the agenda rather than the answer. Each line is a question that has to be turned into a finding for the specific lot, and the rest of this page is how that conversion happens.

The Sale of Land Act 1962 (Vic) requires the vendor to give the purchaser a statement — universally called the section 32 — before the contract is signed. It routinely runs to tens of pages and it is the single densest source of risk in the transaction, because it is where restrictions on title, covenants, easements, encumbrances, notices and orders, owners corporation material and service-connection details all live.

Reading it properly means cross-referencing rather than skimming. A covenant restricting a second dwelling matters only if you intended one; an easement matters differently depending on where it runs across the lot; a notice from a public authority matters enormously and is easy to miss between two schedules. We read every clause, cross-check what it says against the planning report and the title plan, and write the findings back in plain English with a phone briefing before anything gets signed.

The Act is amended frequently — the in-force authorised version was 173 as at 1 July 2026 — so a disclosure list copied from a web page ages badly. That is one reason this page points you at the current checklist and the current Act rather than reproducing a snapshot of either.

Every Victorian address has a planning property report, generated free from VicPlan, listing the planning zone and every overlay that applies to that specific parcel, with the underlying spatial data updated weekly. Running it takes about a minute and it is the fastest way to find out whether a lot carries a Heritage Overlay, a Bushfire Management Overlay, a Land Subject to Inundation Overlay, an Environmental Significance Overlay, a Public Acquisition Overlay or several at once.

The overlay that most changes a purchase decision, and the one buyers most often have never heard of, is the Public Acquisition Overlay at clause 45.01 of the Victoria Planning Provisions. It identifies land proposed to be acquired by a public authority — the acquiring authority and the purpose are named in the schedule to the clause in each planning scheme — reserves the affected land for that purpose, and makes buildings and works on it subject to a permit. If part of a lot sits under a PAO, the developable area and the future of the property are not what the sale photographs suggest, and no amount of renovation planning changes that.

An overlay is a starting point, not a verdict. What matters is the practical effect on your brief: a Heritage Overlay constrains demolition and external change but says nothing about the interior; a Bushfire Management Overlay changes the construction standard and therefore the build cost; an Environmental Significance Overlay commonly controls vegetation removal. We translate each hit into what it does to the plan you actually have, and we check the council’s permit history for the site alongside it, because a refused application tells you what the responsible authority has already decided about that lot.

A building and pest inspection in our engagement files typically costs between $600 and $1,200 depending on property size and complexity. That is an observation from our own files rather than published market data — quotes vary and you should get your own.

We attend the inspection with you rather than waiting for the PDF. The written report is what you keep, but the useful information is often what the inspector says while standing in front of the thing: how confident they are, whether a moisture reading is a leak or a one-off, whether a movement crack is historic or active, and what they would want to look at again. That conversation is very hard to reconstruct from a report afterwards.

The inspection is a third-party cost, charged by the inspector directly and passed through at cost — we attend it with you and we do not mark it up. If a buyers agent bundles it into their own fee, ask them to break it out; and note that under the Estate Agents (Professional Conduct) Regulations 2018 a licensee must disclose any personal or commercial relationship they have with a supplier they recommend, which includes the inspector, the conveyancer and the broker.

The comparables analysis exists to answer one question: what has actually been paid, recently, for property that is genuinely like this one. We work from recent settled sales in the same suburb and adjust for the things that differ — land size, orientation, condition, configuration, position on the street — and we set that against the quoted range before you bid or offer, not after.

We do not publish a headline "our clients buy X% below median" figure. An earlier version of this page did, and it was not reproducible from anything we hold: it had no sample size, no time window and no denominator, and the burden of substantiating that kind of claim sits on us under Australian Consumer Law, not on the reader. What we publish instead is the whole transaction record, so you can compute whatever you like from it yourself.

That record is 345 settlements with offer dates from January 2023 to September 2025, released as open data under CC-BY 4.0 with a permanent DOI (10.5281/zenodo.20095886). Across those 345 purchases the median gross yield after works was 5.77%, where gross yield is annual rent divided by purchase price plus works spend, before land tax, management fees, insurance, maintenance, vacancy and loan interest.

Before you commit we model the property under three treatments — leave as is, cosmetic refresh, or structural work — using rental comparables for the specific suburb and configuration, and cost estimates for the specific scope. Those are inputs for a decision, not a forecast, and we present them as a range with the assumptions visible rather than as a single number.

The only outcome figures we publish are historical medians from settled transactions. Split by strategy across the same 345 settlements and the same January 2023 to September 2025 window: the 212 purchases with a granny flat added recorded a median gross yield after works of 5.79%, the 48 rooming-house conversions 6.94%, and the 85 cosmetic-renovation-only purchases 5.16%. The spread within each strategy is wide, and none of those numbers is a projection for any individual property.

An earlier version of this page published a generic yield ladder — "do nothing 3.8%, cosmetic 4.2%, structural 4.8%" — attached to no property and no data. It has been removed. If any adviser gives you a forward yield for a property you have not bought yet, ask what it is computed from and what happens to it if the rent lands 10% under.

At a private sale, the Sale of Land Act gives you a cooling-off period of three clear business days, running from the date you sign the contract rather than the date the seller signs it. Withdrawing in that window costs $100 or 0.2% of the purchase price, whichever is greater. It is a real safety net and it is short.

It also disappears in the situations buyers most often find themselves in. Cooling off does not apply if the property was bought at a public auction, or within three clear business days before or after one; nor if the property is mainly industrial or commercial, nor if it is farming land over 20 hectares, nor where the buyer is an estate agent or a body corporate, nor on a repeat contract for the same property on the same terms.

That is the whole argument for sequencing. Comparables land before you bid or offer. The building and pest inspection is booked so its findings arrive inside the cooling-off window, or before auction day when there is no window. The section 32 review and the overlay checks are complete before anything goes unconditional. A finding that arrives after exchange is information you paid for and cannot use.