Section 32 Vendor Statement Explained: The Plain-English Guide for Victorian Buyers

You've found your dream home. The layout is perfect, the street is quiet, and you can already picture your furniture in the living room. The agent smiles, hands you a thick document called a "Section 32," and says you should have your solicitor look at it.

You nod, take it home, and open it up. Forty-odd pages of legal jargon, certificates, and council references stare back at you. Half the terms make no sense. You're not even sure what you're supposed to be looking for.

Sound familiar? You are not alone. The Section 32 Vendor Statement is one of the most important documents you will encounter when buying property in Victoria, but it is also one of the most misunderstood. Most buyers skim it or hand it straight to their lawyer without reading a word.

That is a problem. This document tells you things about the property that the vendor is legally required to disclose, things that could affect your finances, your plans for renovation, or even your right to walk away from the deal entirely.

This guide breaks down the Section 32 in plain English. What it is, what should be in it, what to check first, and what happens when something is missing or wrong.

What Is a Section 32 Vendor Statement?

A Section 32 Vendor Statement is a legal disclosure document that every vendor (seller) in Victoria must provide to a buyer before the buyer signs a Contract of Sale. It gets its name from Section 32 of the Sale of Land Act 1962 (Vic), the piece of legislation that sets out what a vendor must disclose.

Think of it as the property's background check. It contains information about the title, any encumbrances on the land, planning restrictions, rates and outgoings, building permits, and more. It's designed to ensure buyers know what they are actually purchasing before they commit.

Why does it exist?

Property transactions involve enormous sums of money, often the largest financial commitment a person will ever make. Before the Sale of Land Act 1962 introduced these disclosure requirements, buyers had far less visibility into the legal and financial state of a property. Vendors could stay silent about debts, restrictions, or defects tied to the land, and buyers would only discover the problems after settlement.

The Section 32 shifts that burden. It requires the vendor to lay their cards on the table. If they fail to disclose something they are required to disclose, the buyer may have the right to rescind (cancel) the contract entirely.

Is it required for every sale?

Yes. Under Victorian law, a vendor must provide a Section 32 Vendor Statement to the purchaser before the purchaser signs the Contract of Sale. This applies to residential property, commercial property, and vacant land. It applies whether the property is sold at auction, by private sale, or through an expression of interest process.

If the sale is by auction, the Section 32 must be available for inspection at least three business days before the auction.

What Must Be Included in a Section 32

The Sale of Land Act 1962 and the Sale of Land (Amendment) Regulations set out specific items the vendor must include. Here is what each one covers, and why it matters to you as a buyer.

1. Title details

The statement must include a copy of the Certificate of Title (also known as the title search) and a plan showing the lot and plan number. This is the foundational document. It tells you exactly what land is being sold, who currently owns it, and what interests are registered against the title.

What to look for: the lot and plan number should match the address. Check whether there are any registered mortgages (which the vendor must discharge before settlement), caveats (which signal someone else is claiming an interest), or any other registered interests.

2. Easements, covenants, and other encumbrances

The Certificate of Title will show any easements, restrictive covenants, or other encumbrances registered on the land. The vendor must disclose these.

An easement gives someone else a right to use part of your land for a specific purpose, for example, a drainage easement allowing the council or a water authority to run pipes under your backyard. A restrictive covenant limits what you can do with the land, for example, a covenant preventing you from building above a single storey.

These can have a direct impact on your renovation plans or your intended use of the property, so they deserve careful attention.

3. Planning information

The vendor must disclose the planning zone and any overlays that apply to the property under the relevant local council's planning scheme. This information comes from the local council and reflects the rules that govern what the land can be used for and what can be built on it.

Zoning determines the primary permitted use: residential, commercial, mixed use, rural, and so on. Overlays add extra controls or requirements. Common overlays in Victoria include Heritage Overlays (restricting changes to the building's appearance), Bushfire Management Overlays (imposing building standards and vegetation management rules), and Flood Overlays (indicating flood risk and restricting development).

If you are buying a property with plans to renovate, subdivide, or change its use, the planning information in the Section 32 is critical reading.

4. Outgoings

The vendor must disclose all outgoings connected to the property. This includes:

• Council rates — the amount and who they are paid to.
• Water rates — the amount and the relevant water authority.
• Owners corporation (body corporate) fees — if the property is part of a strata or owners corporation, the annual fees must be disclosed.
• Land tax — whether land tax is payable on the property and the amount. Note that land tax liability depends on the owner's total land holdings, so this may differ for you as the new owner.
• Any other regular charges — such as drainage levies or fire services levies.

This section helps you understand the ongoing cost of owning the property beyond the purchase price and mortgage repayments.

5. Services connected to the property

The vendor must state which services are connected to the property: electricity, gas, water, sewerage, telephone, and internet. They must also disclose whether the property is connected to a septic tank system rather than mains sewerage.

If the property is in a rural or semi-rural area, the distinction between mains water and tank water, or mains sewerage and septic, can have significant cost implications.

6. Building permits issued in the last 7 years

The vendor must disclose details of any building permits issued in respect of the property within the previous seven years. This includes the permit number, what work the permit covered, and whether a certificate of final inspection or occupancy permit was issued.

This is important because a building permit without a final inspection certificate can mean the work was never signed off by a building surveyor. That could indicate the work does not comply with the Building Code of Australia, and you could inherit the problem.

7. Owner-builder warranty information

If any building work was done by an owner-builder (rather than a registered builder) within the last six years and the work was valued at over $16,000, the vendor must provide specific disclosures. Under the Domestic Building Contracts Act 1995 and the Building Act 1993, owner-builders have warranty obligations and may need to provide a defects report or insurance.

If the vendor did their own renovation or extension as an owner-builder, you need to understand what protections (if any) you have if defects emerge after purchase.

8. Swimming pool and spa compliance

If the property has a swimming pool or spa, the vendor must provide a certificate of compliance or a certificate of non-compliance with the pool and spa safety barrier requirements under the Building Act 1993 and the Building Regulations 2018.

Victorian law requires all swimming pools and spas to be registered with the local council and to have a compliant safety barrier. Non-compliance creates a safety risk and may require you to spend money on fencing or barrier upgrades after purchase.

9. Owners corporation certificate

If the property is part of an owners corporation (common for apartments, townhouses, and units), the vendor must attach an owners corporation certificate. This certificate is obtained from the owners corporation manager and contains critical financial information, including:

• The current fees and any special levies.
• The balance of the maintenance fund and any sinking fund.
• Whether there are any outstanding debts or legal proceedings involving the owners corporation.
• The rules of the owners corporation.

A poorly funded owners corporation or one with ongoing litigation can mean unexpected costs for you as a new lot owner.

10. Growth Areas Infrastructure Contribution (GAIC)

If the property is located in a designated growth area, the vendor must disclose whether a Growth Areas Infrastructure Contribution is payable under the Planning and Environment Act 1987. GAIC applies to certain land in Melbourne's outer growth corridors and can amount to a significant sum upon subdivision or development.

For most established residential properties, this will not apply. But if you are buying in a growth area or buying land to develop, it is an essential disclosure.

What to Check First in a Section 32

Even if you plan to have your solicitor or conveyancer review the Section 32 in full, it helps to know where to focus your own attention. Here are the five things that matter most.

1. The title search — who owns it and what's on it

Look at the Certificate of Title. Confirm the vendor named on the title matches the vendor named on the Contract of Sale. Check for any registered easements, covenants, or caveats. These will be listed as instrument numbers on the title, and the vendor should attach copies of each one.

If there is a mortgage registered on the title, that is normal. The vendor will use the sale proceeds to discharge it. But if there are multiple mortgages, caveats, or unusual interests, ask your solicitor to investigate.

2. Planning zone and overlays

Find the planning certificate or information section. Confirm the zoning matches what you expect. If you are buying a property in a residential zone with plans to run a business from home, or buying with plans to subdivide, the zoning and overlays will determine whether that is possible.

Heritage and flood overlays are the ones that catch buyers off guard most often. A Heritage Overlay can mean you need a permit for even minor external changes. A flood or land subject to inundation overlay can affect insurance premiums and future development.

3. Building permits and final inspections

If the property has been renovated or extended, check whether the building permits are listed and whether final inspection certificates were issued. A permit without a final certificate is a gap you need to understand. It does not necessarily mean the work is defective, but it means no one has confirmed it complies.

4. Owners corporation details (for units and apartments)

If you are buying into a strata scheme, read the owners corporation certificate carefully. Look at the balance of the funds. A very low maintenance fund or sinking fund could mean a special levy is coming. Check whether there are any pending or threatened legal proceedings. Check the rules for anything that might affect your use of the property, such as pet restrictions, short-term rental restrictions, or renovation approval processes.

5. Outgoings and ongoing costs

Add up the council rates, water rates, and owners corporation fees. These are your guaranteed annual costs. Make sure these fit within your budget on top of mortgage repayments and insurance.

Red Flags in a Section 32

Not every issue in a Section 32 is a dealbreaker, but some problems should make you pause and get professional advice before proceeding.

Missing or incomplete documents

The most common red flag is missing attachments. If the Certificate of Title is not included, or if the planning information is absent, or if an owners corporation certificate is missing when the property is clearly part of a strata scheme, the statement may be defective. Do not proceed until the gaps are filled.

Undisclosed easements or covenants

If you discover an easement or restrictive covenant that was not disclosed in the Section 32, that is a serious issue. An undisclosed drainage easement running through the middle of the backyard could prevent you from building an extension. A restrictive covenant limiting the property to single-storey construction could undermine your plans entirely.

Compare what is disclosed in the Section 32 against the Certificate of Title. Everything registered on the title should be addressed in the statement.

Planning overlays not mentioned

Sometimes a vendor's Section 32 will state the zoning but fail to mention applicable overlays. If the property is subject to a Heritage Overlay, Bushfire Management Overlay, Environmental Significance Overlay, or any other overlay, and the vendor has not disclosed it, that is a gap in the statement.

You can verify this yourself by checking the Victorian Planning Maps website (VicPlan) or requesting a planning certificate from the relevant council.

Owner-builder works without proper documentation

If the vendor carried out building work as an owner-builder and the Section 32 does not include the required warranties, insurance, or a defects report from a registered building practitioner, you need to be cautious. Owner-builder work without proper sign-off can leave you without warranty protection if defects appear after settlement.

Pool or spa non-compliance

A certificate of non-compliance means the swimming pool or spa safety barrier does not meet current standards. You will be responsible for bringing it into compliance after purchase, and the cost of barrier replacement or modification can range from a few hundred dollars to several thousand.

If the property has a pool or spa and no compliance certificate is attached, treat it as a red flag. The vendor is required to provide one.

Large debts or legal action in the owners corporation

If the owners corporation certificate reveals significant outstanding debts, pending legal proceedings, or a history of special levies, these are warning signs of financial mismanagement or building defects within the complex. A large upcoming special levy could cost you tens of thousands of dollars shortly after settlement.

What If the Section 32 Is Defective?

This is where the legislation gives buyers real power. Under Section 32(f) of the Sale of Land Act 1962, if a vendor has failed to provide a Section 32 that complies with the Act, or if the information in it is materially deficient, the buyer may have the right to rescind the contract.

Rescission means the contract is cancelled. The deposit is returned to the buyer, and both parties walk away as if the contract never existed. It is a complete unwinding of the deal.

What counts as a defective Section 32?

A Section 32 may be considered defective if:

• It was not provided before the buyer signed the contract.
• Required information is missing (for example, no title search, no planning information, no owners corporation certificate when one is required).
• The information provided is materially inaccurate or misleading.
• Required certificates (such as pool compliance) are not attached.

Are there limits on the right to rescind?

Yes. The right to rescind is not absolute and courts have considered the materiality of the deficiency. Minor errors that do not affect the buyer's decision may not give rise to a right of rescission. The buyer must also act promptly. If you discover a defect in the Section 32 but continue with the purchase and proceed toward settlement without raising it, you may be taken to have waived your right.

In practice, if you discover a problem with the Section 32, raise it with your solicitor or conveyancer immediately. Do not wait.

What about auction purchases?

This is particularly important for auction buyers. When you buy at auction in Victoria, there is no cooling-off period. The contract is binding the moment the auctioneer's hammer falls. However, your right to rescind due to a defective Section 32 is separate from the cooling-off period. Even at auction, if the Section 32 is defective, you may still have the right to rescind the contract under Section 32(f).

This is one of the few protections auction buyers retain, which makes it even more critical to review the Section 32 before auction day, not after.

Section 32 vs Contract of Sale — What's the Difference?

Buyers often confuse the Section 32 Vendor Statement with the Contract of Sale, or assume they are the same document. They are not.

The Section 32 Vendor Statement is a disclosure document prepared by the vendor. Its purpose is to inform the buyer about the state of the property and the title. It tells you what you are buying.

The Contract of Sale is the agreement between the buyer and the vendor. It sets out the terms of the transaction: the price, the settlement date, the deposit amount, any special conditions, and the obligations of each party. It governs how the purchase happens.

In practice, the two documents are usually provided together, often stapled or bound as a single package. The Section 32 typically comes first, followed by the Contract of Sale. But their legal functions are distinct.

You should review both documents with equal care. The Section 32 tells you what the vendor is required to tell you about the property. The Contract of Sale tells you what you are agreeing to. Problems can exist in either document.

A practical example

The Section 32 might disclose an easement for a shared driveway running along the side of the property. The Contract of Sale might contain a special condition requiring the buyer to accept the property subject to that easement. The disclosure is in the Section 32. The legal agreement about it is in the Contract of Sale. You need to understand both.

Key Takeaways

The Section 32 exists to protect you. It is your legal right as a buyer to receive full disclosure about the property before you commit to purchasing it. Do not treat it as a formality.

Read it before the auction, not after. If you are buying at auction, there is no cooling-off period. The Section 32 must be available at least three business days before the auction. Use that time.

Check the title, the planning information, and the building permits first. These three items reveal the most common issues that affect buyers after settlement.

Look for gaps, not just problems. A missing document is often more concerning than a disclosed issue. If something is supposed to be there and it is not, ask why.

A defective Section 32 can give you the right to rescind. Under Section 32(f) of the Sale of Land Act 1962, a materially deficient vendor statement can allow you to cancel the contract and get your deposit back. But you must act quickly.

Get professional advice. A solicitor or licensed conveyancer who specialises in Victorian property transactions can review the Section 32 and flag issues you might miss. The cost of a professional review is minimal compared to the risk of buying a property with undisclosed problems.

The Section 32 and the Contract of Sale are different documents with different purposes. The Section 32 is disclosure. The Contract of Sale is the agreement. Review both thoroughly before signing anything.