# What Happens If a Property Sale Falls Through in Queensland?
If a Queensland property sale falls through, the first step is to identify exactly why the contract ended. The seller’s rights, the deposit and the next marketing step depend on the contract wording and the way the buyer terminated.
Don’t assume every failed contract is the same. Ask your solicitor to confirm whether the buyer validly used a cooling-off right, finance condition, building and pest condition, disclosure right or another contract clause.
This article is general information, not legal advice.
Does “under contract” mean the property is sold?
It means the seller and buyer have signed a contract. It does not always mean every condition has been satisfied.
A conditional contract may still depend on finance, building and pest, due diligence or another agreed condition. A normal residential private-treaty contract may also have a five-business-day cooling-off period unless it is waived or an exception applies.
The sale becomes more certain as each condition is satisfied, but settlement is the point when ownership and the final payment transfer.
Common reasons a sale falls through
The buyer terminates during cooling-off
Queensland’s standard residential contract generally has a five-business-day cooling-off period. Auctions do not have that cooling-off period, and there are other exceptions.
A buyer who terminates correctly during cooling-off may face a penalty of up to 0.25% of the purchase price. The seller must generally refund the balance of the deposit within 14 days. Your solicitor should confirm the exact application to your contract.
The buyer cannot obtain finance
If the contract is subject to finance, the wording, dates and steps matter. A buyer may be entitled to terminate when the finance condition has not been satisfied, but this is not something an agent or seller should decide from a phone conversation alone.
Send the notice and contract to your solicitor immediately.
Building and pest issues
A building and pest condition may allow a buyer to terminate or lead to a request for repairs or a price change. The standard Queensland wording and whether the buyer acted reasonably need legal interpretation.
A seller can negotiate, reject a request or seek to test the buyer’s position, but that choice should be made with the solicitor after reviewing the report and contract.
Seller disclosure problems
Queensland’s seller disclosure scheme has applied since 1 August 2025. Sellers must give the buyer required information before the contract is signed. A buyer may have termination rights where the seller does not comply or where the disclosure position meets the statutory test.
Read Seller Disclosure Statement Queensland and obtain legal advice before issuing a new contract.
A settlement default or delay
A failure close to settlement can be more serious than a valid termination under an earlier condition. Default notices, extensions, interest, deposit rights and termination consequences depend on the contract and the facts.
Do not relist or promise the property to a new buyer until your solicitor confirms the first contract has ended and tells you what can safely happen next.
What happens to the deposit?
There is no one answer.
If the buyer validly terminates under cooling-off or a contract condition, all or most of the deposit may be refundable. If the buyer defaults after the contract is unconditional, different contractual rights may apply.
The agent normally holds the deposit in trust and should act only on the proper legal authority. The seller should not promise the deposit to either side or treat it as compensation before receiving legal advice.