Vacant possession is a term used in property transactions to describe situations where a property is available at settlement at an agreed time and in an acceptable vacant condition, or when the settlement process has been completed for the buyer to move in. It is often an issue when a buyer intends to use the property as a home.

A Contract of Sale of Land has two options dealing with possession provided on settlement. It can either be “vacant possession” or “subject to existing tenancy”. If neither options are marked, there is a presumption that the buyer will obtain vacant possession on settlement.

Types of Vacant Possession

Vacant possession includes:

  • giving title to the property free from any tenancy or right of occupation; and
  • giving physical vacant possession.

Vacant possession will usually appear in both residential transactions and commercial lease transactions. This includes:

  • When property is sold or a lease is granted;
  • When a tenant vacates at the end of the term; and
  • When a tenant breaks a lease early, in which case vacant possession may well be a condition of the break.

Physical Vacant Possession

Physical vacant possession requires the vendor to remove all goods not included in the sale from the property prior to completion. It must be empty of chattels (moveable objects such as furniture, picture, boxes and rubbish) and no-one else must have the right to occupy or possess it.

There is also an additional contractual obligation for vendors to leave premises in a reasonably clean condition. A vendor must maintain the condition between exchange and settlement. This includes not damaging the property and taking reasonable care to preserve it in the condition it was in at the date of the Contract. It is the vendor’s responsibility to clean up the premises prior to passing it over to the purchaser.

Consequences of Failure to Give Vacant Possession

Failing to give vacant possession has a number of serious consequences for the tenant. For commercial leasing, the lease will not terminate and the tenant will remain bound. A residential buyer has the option to apply for specific performance as well as damages. For a commercial tenant, failure to give vacant possession at the end of the lease will give right to damages.


LegalVision can assist you with any questions you may have about your property transaction including vacant possession. LegalVision has a team of great lawyers who can assist you in any property law matters. Please call our office on 1300 544 755 and our Client Care team will happily provide you with an obligation-free consultation and a fixed-fee quote.

COVID-19 Business Survey
LegalVision is conducting a survey on the impact of COVID-19 for businesses across Australia. The survey takes 2 minutes to complete and all responses are anonymous. We would appreciate your input. Take the survey now.

About LegalVision: LegalVision is a tech-driven, full-service commercial law firm that uses technology to deliver a faster, better quality and more cost-effective client experience.

The majority of our clients are LVConnect members. By becoming a member, you can stay ahead of legal issues while staying on top of costs. For just $199 per month, membership unlocks unlimited lawyer consultations, faster turnaround times, free legal templates and members-only discounts.

Learn more about LVConnect

Need Legal Help? Get a Free Fixed-Fee Quote

If you would like to receive a free fixed-fee quote or get in touch with our team, fill out the form below.

  • By submitting this form, you agree to receive emails from LegalVision and can unsubscribe at any time. See our full Privacy Policy.
  • This field is for validation purposes and should be left unchanged.
Our Awards
  • 2019 Top 25 Startups - LinkedIn 2019 Top 25 Startups - LinkedIn
  • 2019 NewLaw Firm of the Year - Australian Law Awards 2019 NewLaw Firm of the Year - Australian Law Awards
  • 2020 Fastest Growing Law Firm - Financial Times APAC 500 2020 Fastest Growing Law Firm - Financial Times APAC 500
  • 2020 AFR Fast 100 List - Australian Financial Review 2020 AFR Fast 100 List - Australian Financial Review
  • 2020 Law Firm of the Year Finalist - Australasian Law Awards 2020 Law Firm of the Year Finalist - Australasian Law Awards
  • Most Innovative Law Firm - 2019 Australasian Lawyer 2019 Most Innovative Firm - Australasian Lawyer
Privacy Policy Snapshot

We collect and store information about you. Let us explain why we do this.

What information do you collect?

We collect a range of data about you, including your contact details, legal issues and data on how you use our website.

How do you collect information?

We collect information over the phone, by email and through our website.

What do you do with this information?

We store and use your information to deliver you better legal services. This mostly involves communicating with you, marketing to you and occasionally sharing your information with our partners.

How do I contact you?

You can always see what data you’ve stored with us.

Questions, comments or complaints? Reach out on 1300 544 755 or email us at

View Privacy Policy