Section 32 explained: what home buyers in Victoria need to know

What is a Section 32?

A Section 32 (Vendor's Statement) is a legally required disclosure document under Section 32 of the Sale of Land Act 1962 (Vic). It's provided by the seller (often with the help of a solicitor or conveyancer) to any prospective buyer before the buyer signs a contract for the purchase of land or property in Victoria.

The purpose of the Section 32 is to give buyers transparent and accurate information about the title, land, encumbrances, and key legal matters affecting the property: details that an ordinary property inspection might not reveal.

Without a compliant Section 32, a buyer's contract may not be legally enforceable, and the buyer may have the right to withdraw from the sale without penalty.

Why Section 32 matters

You wouldn't buy a car without reviewing its service history. You shouldn't buy property without seeing the Section 32.

Unlike a physical inspection that tells you what the property looks like, the Section 32 tells you what's attached to the title, what's required by law, and what ongoing responsibilities or restrictions come with the land.

In a nutshell, it allows you to make more informed decisions as a buyer.

Because of its legal significance, both buyers and sellers typically engage qualified professionals (licensed conveyancers or property solicitors) to prepare and review Section 32 statements. 

What a Section 32 must include

A Section 32 is not a single sheet of paper. It's a comprehensive compilation of disclosures and documents relating to the land and property.

While the exact contents vary depending on the property type and context, a compliant Section 32 should include:

• Title and ownership information - confirms who owns the land and whether there are any registered mortgages, caveats, or restrictions
• Encumbrances and easements - details of any easements (e.g. shared driveways, drainage rights) or covenants affecting the land
• Outgoings and financial details - council rates, water rates, land tax, and any other charges affecting the property
• Planning scheme and zoning - information about the relevant planning scheme, zoning classification, and local government controls on land use
• Building works and permits - any building permits issued in the past seven years must be disclosed. If the seller acted as an owner-builder, additional reports or insurance documents must be included
• Notices or orders - any notices or orders from government or statutory authorities that could affect the land, like compulsory acquisition or non-compliance issues
• Service connections - confirmation of available services (water, sewerage, electricity, gas, telephone, internet) and any that are not connected
• Owners corporation information - for unit titles, apartments, or shared property, relevant owners corporation certificates and levies or pending works need to be disclosed
• Statutory warnings - warnings required by law to alert buyers to legal rights or obligations before entering into a contract
• Additional materials - depending on the property, additional materials such as plans, certificates, and insurance documentation may also be attached.

How Section 32 differs for houses, townhouses, apartments and rural properties

While the core purpose of a Section 32 (Vendor's Statement) is the same across all property types (to disclose key legal and financial information before you sign a contract) the content and risk profile can vary significantly depending on whether you're buying a freestanding house, townhouse, apartment or rural property.

Understanding these differences helps you review the document with the right lens.

Freestanding houses

For a standalone house on its own title, the Section 32 is usually more straightforward.

Key areas to scrutinise include:

• title boundaries
• drainage and sewerage easements, which may restrict extensions or pools
• restrictive covenants that may limit building height, materials, or subdivision potential
• planning overlays (bushfire, heritage, flood or vegetation overlays), which can impact renovations or redevelopment
• building permits issued within the past seven years.

With houses, the primary risks tend to relate to land use restrictions, unapproved building works, and infrastructure easements.

Townhouses

Townhouses sit somewhere between houses and apartments, and the Section 32 often reflects that hybrid nature. Some townhouses are on separate titles with shared services, while others are part of an owners corporation.

In addition to standard house disclosures, you may see:

• owners corporation (OC) certificates, fees, insurance, and special levies
• shared driveway or access easements
• common property arrangements
• any planned major works by the owners corporation.

Buyers should pay close attention to:

• the financial health of the owners corporation
• any disputes among lot owners
• long-term maintenance plans.

Apartments and units

For apartments, the Section 32 becomes significantly more complex because of strata or owners corporation arrangements. In apartment buildings, buyers are effectively purchasing both a private lot and an interest in common property.

Expect detailed disclosures relating to:

• owners corporation rules and regulations
• annual fees and levies
• sinking fund balances
• insurance policies
• building defects or rectification works
• legal proceedings involving the owners corporation.

Important red flags can include:

• low sinking fund balances
• pending special levies
• ongoing defect litigation
• flammable cladding notices
• significant maintenance backlogs.

Unlike a standalone house, your financial exposure may extend to building-wide issues that require collective funding.

Rural and regional properties

Section 32 statements for rural properties are often the most extensive due to additional land-use considerations.

In addition to standard disclosures, rural Section 32s may include:

• water rights and usage entitlements
• irrigation licences
• native vegetation restrictions
• farming infrastructure encumbrances
• access arrangements across neighbouring land
• crown land leases or licences
• Bushfire Management Overlays.

Zoning is particularly critical in rural transactions. Agricultural zoning can restrict subdivision or change of use, and planning controls may limit future development.

Buyers should carefully assess:

• access to utilities (water, sewerage, electricity may not be fully connected)
• road access rights
• environmental overlays
• land tax implications for larger parcels.

Property inspections and Section 32

When buying a home in Victoria, think of your risk management in two streams:

1. Legal due diligence - reviewing the Section 32 (Vendor's Statement) and Contract of Sale.
2. Physical due diligence - building inspections, pest inspections, drug residue testing, and specialist reports where required.

Together, they give you a comprehensive understanding of what you are buying.

More: What are the benefits of a property inspection?

Building and structural inspections

The Section 32 may disclose that building permits were issued within the last seven years. But it won't confirm whether the work was carried out properly or whether there are defects.

A building inspection (often called a structural inspection) assesses the overall condition of the property. A qualified building inspector will typically evaluate:

• foundations and footings
• structural integrity of walls and roof framing
• drainage issues
• signs of subsidence or cracking
• moisture intrusion and waterproofing failures
• compliance concerns in visible building work.

If the Section 32 discloses recent renovations, your inspector can pay closer attention to those areas.

If no permits are disclosed but you see significant new works, your conveyancer may investigate whether approvals were required but not obtained.

Pest inspections

Termites and timber pests are common issues in parts of Victoria, particularly in older homes or areas with high moisture levels.

But pest problems are not typically disclosed in a Section 32 unless they relate to formal notices or legal disputes. There is no automatic requirement for a seller to declare termite history unless specifically asked or legally required in certain circumstances.

A pest inspection assesses:

• active termite infestation
• past termite damage
• conditions conducive to infestation
• timber rot and decay.

Drug residue testing

Drug contamination, particularly methamphetamine residue, is an emerging risk in residential property transactions. Contamination can occur even if the property was not used as a large-scale lab, as long-term smoking can leave harmful residues.

Unless there has been a formal government notice or remediation order, a Section 32 is unlikely to disclose past drug use or contamination.

Drug residue testing involves specialised surface sampling to determine whether contamination exceeds safety thresholds.

Illegal or non-compliant building work

The Section 32 must disclose building permits issued within the last seven years. If visible works were completed outside that window (or without permits) the legal risk shifts to the buyer after settlement.

A property inspection can flag potential unapproved works, while the conveyancer can review the Section 32 for permits and approvals. Further enquiries are made with council if necessary.

Making inspections a condition of the contract

In Victoria, buyers commonly include a 'subject to building and pest inspection' clause in the Contract of Sale.

This allows you to:

• obtain inspections after signing
• withdraw or renegotiate if major defects are identified.

This condition is separate from your rights relating to a defective Section 32.

How to get a property's Section 32

When you attend a property's open or private inspection, you can ask the the real estate agent for a copy of its Section 32. They will then generally email you the property's Section 32 for you to review.

Asking for a Section 32 demonstrates your interest in the property, but you have no obligations to proceed further.

What to do once you receive the Section 32

Once a Section 32 statement is provided, don't sign anything yet. Take these essential steps:

Review carefully (with professional help)

Have your conveyancer review the document thoroughly. They are trained to spot omissions, outdated certificates, or legal issues.

Cross-check against what you've seen

Does what's disclosed match your inspection? For example, if the Section 32 says no recent building permits but you see a new structure, investigate further.

Ask for missing documents

If something that should be in the Section 32 is missing, like a water information statement or owners corporation certificate, your advisor can request those before you commit.

Consider additional checks

A Section 32 doesn't replace a building inspection or pest report, but it can help guide what additional expert checks might be wise.

Until you've signed the contract with a compliant Section 32 attached, your legal rights regarding withdrawal are generally preserved.

What happens if the Section 32 has something missing, inaccurate, or not provided?

One of the most important protections a Section 32 provides is the right to reconsider a purchase if the disclosures are incorrect or incomplete before the contract is signed.

If a seller fails to provide a correct Section 32:

• the contract may not be legally binding on the buyer.
• the buyer may have the right to cancel the contract without penalty.
• after signing, if serious misrepresentations are found, the buyer may still have options to resolve disputes (although rights may be more limited).

For sellers, providing a defective or inaccurate statement can have costly consequences, including delays, disputes, or even legal action. That's why most sellers engage a professional to prepare the Section 32.

Practical Section 32 tips for buyers

Never sign a property contract without the Section 32 attached

Before a property can be sold in Victoria the buyer must be given a copy of the section 32 statement. If it's not ready yet, insist on seeing it before you commit.

Use a licensed conveyancer or solicitor

A licensed conveyancer or solicitor will understand what must be disclosed and what might be missing or ambiguous.

Time your due diligence appropriately

Section 32 statements can be prepared months before listing. Ask for the latest documents to ensure nothing has changed.

Understand what a Section 32 does not cover

A Section 32 doesn't tell you about building defects, pest risks, or structural conditions. These are separate inspections that you must arrange.