Traditionally, an option allows one party the enforceable right to buy something at a future time at a particular price. This means the only stamp duty payable until the contract comes into existence ie after the exercise of either one or both options , is negligible.

This has an obvious attraction to buyers of development projects where the approval process extends to 12 months or more because the payment of substantial stamp duty on the actual purchase price is deferred. Put and call options also allow greater flexibility to the buyer in that they can usually transfer their interest under the option far more efficiently in terms of stamp duty and legal overheads than if they had to sell the land or transfer the interest under a purchase contract.

Option Deed

Property marketers often take put and call options to gain the exclusive right to market lots for sale for a specific period of time. Importantly, the buyer under a put and call option still has a caveatable interest in the property.

There are however some disadvantages to using a put and call option in place of a regular contract. They are more complex than a standard REIQ document and therefore involve greater time and legal expense in their preparation.

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There will be some resistance from property owners who might regard this form of documentation as complex. Extra time is also often required to negotiate the terms of the option agreement.

It must be remembered that if an option to acquire land in Queensland is terminated or assigned, this is classified as a surrender of dutiable property and further stamp duty may be assessable.

The requirements of PAMDA section B must still be satisfied as an option to purchase is a contract to sell land i.

If a third party is nominated to purchase then the PAMDA requirements must again be complied with when the option is exercised. It is normal for special conditions to be included in options including amongst others due diligence enquiries, development approvals if applicable , FIRB and access arrangements.

Put & Call Options | Gold Coast Property Lawyers

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It is rare for put options to exist in real estate transactions by themselves. How did you find us Locations Brisbane City Charlotte Street, Brisbane 07 P.