As of 1 January 2022, all homes or units that are being sold, or leased will require interconnected smoke alarms that are connected to the dwelling’s electrical supply.
All parties involved in a residential transaction should be aware of the following practical changes going forward.
Property Sale – REIQ Contract for Houses
The REIQ Contract for Residential Properties, updated on 20 January 2022, includes new provisions in line with the smoke alarm rules. Clause 7.8 of the Standard Terms of Contract requires any residential houses to comply with the new smoke alarm rules by the Settlement Date.
As the Seller, the party must declare whether compliant smoke alarms are installed in the property as part of the Contract. False or misleading declaration under the Contract (or the Queensland Titles Form 24) may lead to penalties under the Fire and Emergency Services Act 1990.
However, under the Standard Terms of the REIQ Contract, the Seller has no further obligation under the Contract to provide evidence or records that compliant smoke alarms have been installed.
It is the responsibility of the Buyer to verify whether the smoke alarms are compliant with the updated rules. If the property was found to not have complied with the new smoke alarm rules, the Buyer can request an adjustment of 0.15% of the Purchase Price. This is the only remedy that the Buyer can seek, and they cannot use the findings to request further discounts or to terminate the Contract.
While the remedies available to the Buyer are minor, ensuring that compliant smoke alarms are installed would be an important part of a property inspection and due diligence. This is especially important if the intent of the Buyer is to rent out the property after purchase.
Unlikely the sale of a property, an owner seeking to rent out their residential property is not required to provide specific notices to tenants regarding smoke alarms. The latest General Tenancy Agreement (as of June 2021) contains no provisions related to smoke alarms. Nevertheless, a lessor must comply with Smoke Alarm rules, including the additional requirement to clean and test the smoke alarms within 30 days before the start of a new (or renewed) tenancy.
The tenant in the residential tenancy will be required to clean and test the smoke alarms every 12 months and must inform the landlord if the smoke alarm needs replacement.
If you have any questions about how the latest smoke alarm rules may affect your transaction, please feel free to contact Jake Cho at Jake.Cho@Perspectivelaw.com or Perspective Law on 07 3839 7555.