A subsale property refers to the purchase of a property from an existing owner, rather than directly from a developer. These transactions are common in the secondary market and involve several legal and financial steps.
🔑 Key Features of Subsale Transactions
- Existing Property – The unit is already completed and often occupied or previously owned.
- Negotiated Price – Price is based on mutual agreement between buyer and seller.
- Financing – Buyers usually apply for a housing loan; a valuation of the property is required.
- Legal Documentation – The transaction requires a Sale and Purchase Agreement (SPA) prepared by lawyers.
⚖️ Legal Process
- Offer to Purchase / Letter of Intent – Buyer and seller agree on price and terms.
- Deposit Payment – Typically 2–3% upon signing the offer, followed by 7–8% upon SPA execution.
- Sale and Purchase Agreement (SPA) – Drafted and executed by lawyers, outlining the rights and obligations of both parties.
- Loan and Security Documents – If financing is required, loan agreement and legal charge (mortgage) must be completed.
- Stamping and Registration – Transfer of ownership is registered at the land office once all conditions are fulfilled.
📌 Why Legal Guidance is Important
Subsale transactions involve existing encumbrances, caveats, or tenancy issues. Engaging a lawyer ensures that:
- The property title is free from encumbrances.
- The transfer process is smooth and legally binding.
- All payments are handled securely through the law firm’s client account.