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How Long Is the Cooling-Off Period When Buying a House?

Buying a house is a big decision and in New South Wales, you have a short window to change your mind after signing a contract. This grace period is called the "cooling-off period." But how long is it, when does it start, and can it be waived? Here’s what every buyer needs to know before locking in a property purchase. 

What Is a Cooling-Off Period? 

The cooling-off period is a 5-business day window that gives residential property buyers in NSW the right to withdraw from a signed contract, without needing to give a reason. 

It exists to give buyers time to: 

• Reconsider the purchase 

• Finalise finance 

• Conduct additional due diligence (e.g. building and pest inspections) 

If you decide to pull out during the cooling-off period, you’ll forfeit 0.25% of the purchase price to the seller. The rest of your deposit will be refunded. 

When Does the Cooling-Off Period Start? 

It begins on the day the contract is exchanged. That is, when both parties have signed and dated identical copies of the sale contract. 

The period runs for 5 business days, ending at 5pm on the fifth business day after exchange. 

For example:
If contracts are exchanged on a Tuesday, the cooling-off period typically ends at 5pm the following Tuesday (excluding weekends and public holidays). 

Does the Cooling-Off Period Always Apply? 

Not always. The cooling-off period applies only to residential property purchases in NSW, and only for buyers. 

It does not apply in the following situations: 

• The property is bought at auction (or on the same day as an auction) 

• The buyer has waived the cooling-off period using a s 66W certificate 

• The property is non-residential (e.g. commercial or industrial) 

What’s a Section 66W Certificate? 

A Section 66W certificate is a legal document signed by your solicitor or conveyancer that waives your right to a cooling-off period. 

Buyers may be asked to sign one in competitive markets where sellers want a fast, unconditional exchange. If you’re asked to provide a 66W, make sure your legal representative reviews the contract thoroughly before signing. 

Can the Cooling-Off Period Be Extended? 

Yes, but only if both parties agree in writing. Sellers are not obligated to grant an extension, so make sure you’ve done your due diligence as early as possible if you're relying on this timeframe. 

Can I Still Do Inspections During the Cooling-Off Period? 

Absolutely—and you should! 

The cooling-off period is your window to: 

• Conduct a building and pest inspection 

• Finalise loan approval 

• Seek legal advice or negotiate terms 

• These tasks should ideally begin before signing the contract, but if time is tight, the cooling-off period offers a safety net. 

What Happens If I Withdraw? 

If you change your mind and cancel the contract during the cooling-off period: 

• You must give written notice before 5pm on the final day 

• You’ll lose 0.25% of the purchase price 

This fee is compensation to the seller for taking the property off the market during that time. 

Final Thought: Don’t Sign Blind! 

The cooling-off period is a legal safeguard, but it’s not a replacement for due diligence. At ClickLaw, our property solicitors make sure you understand the contract, your rights, and any hidden risks before you sign, so you can move forward with confidence. 

Have questions about your property contract or cooling-off rights? Contact ClickLaw today and get expert legal advice from a team that makes property law simple and stress-free.