What is the length of a Deposit Bond?
Deposit bonds range from one month up to a maximum of 60 months. The term of the deposit bond is based upon the sunset clause which is found in the contract of sale. The sunset clause is the maximum amount of time the developer/builder has to build the property allowing for rain delays, union problems, council problems etc. If the property is not completed by the date set out in the sunset clause the developer and the applicant both have the right to rescind the contract, i.e. walk away. This could work in the favour of the applicant if they are not able to settle the property or the market has declined and they do not want to settle the property. However, it could be a disadvantage to the applicant if the value of the property has increased over the construction period and the developer decides to rescind the contract and resell the property for a higher price (with the applicant missing out on the capital growth of the property). This is one of the risks in purchasing off the plan pr
