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Call options in QLD: A Comprehensive Explanation

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Sunstate explains Call options

Call options in QLD: A Comprehensive Explanation

If you’re involved in the real estate market in Queensland, you may have come across the term “call options.” Call options are a legal arrangement that grants the holder the right, but not the obligation, to purchase a property at a predetermined price within a specified period. This article aims to provide a comprehensive explanation of call options in Queensland, shedding light on their purpose, benefits, and legal considerations.

What is a Call Option?
A call option is a contractual agreement between two parties: the grantor (property owner) and the option holder (potential buyer). The grantor grants the option holder the exclusive right to purchase the property at a predetermined price (known as the exercise price) within a specific timeframe. This timeframe is typically negotiable and can range from a few months to several years.

Purpose of Call Options

Call options serve various purposes for both buyers and sellers. For property owners, call options offer an opportunity to secure a potential buyer without committing to an immediate sale. It provides flexibility and time to evaluate market conditions or resolve any outstanding matters related to the property.

On the buyer’s side, call options allow them to secure a property they are interested in at a specific price, even if they are not yet ready to proceed with the purchase. It provides a sense of security and avoids the risk of losing out on a desirable property.

Benefits of Call Options
1. Locking in a Purchase Price: Call options enable buyers to secure a property at a predetermined price, safeguarding them from potential price increases during the option period.
2. Flexibility: Call options offer flexibility for both parties. Buyers have the freedom to assess the property, conduct due diligence, and secure financing before committing to the purchase. Sellers have the advantage of knowing they have a potential buyer and can plan accordingly.
3. Mitigating Risk: Call options provide a level of protection for both buyers and sellers. Buyers can walk away from the purchase if they encounter any unexpected issues during the option period. Sellers have the assurance of a committed buyer, reducing the risk of the property sitting on the market for an extended period.
4. Opportunity for Developers: Call options are often used by property developers to secure land for future development. It allows developers to control the property without the need for immediate payment, giving them time to obtain necessary approvals and financing.


Legal Considerations
It is crucial to seek legal advice when engaging in a call option agreement. Both parties must clearly define the terms and conditions in a legally binding contract. Key elements to consider include the exercise price, option period, any conditions or restrictions, and the process for exercising the option.

Additionally, it’s essential to understand that call options are subject to specific regulations and legislation in Queensland. Compliance with the Property Occupations Act 2014 and other relevant legislation is necessary to ensure the validity and enforceability of the call option agreement.


Call options provide an alternative approach to property transactions in Queensland, offering flexibility, protection, and opportunity for both buyers and sellers. Understanding the purpose, benefits, and legal considerations of call options is vital when considering this option as part of your real estate strategy. Seeking professional legal advice will help navigate the complexities and ensure a smooth and successful transaction.
If you have any further questions or require assistance with call options in Queensland, do not hesitate to reach out to a qualified legal professional or conveyancer.


This is general advice, for specific legal advice speak with your legal representative. 

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