Put and Call Option Deeds
Option deeds for buying and selling property where the parties agree the deal now but exchange contracts later - common in developments, subdivisions and off-market sales.
- Option deed with the contract annexed
- Option fee and exercise terms
- Nomination, caveat and duty planning
Options Over Property
How a Put and Call Option Works
The buyer receives a call option - the right to require the seller to sell. The seller receives a put option - the right to require the buyer to buy. Whichever option is exercised, a binding contract comes into existence on the terms annexed to the deed.
The effect is close to an exchanged contract, with more flexibility on timing. Buyers use options to secure a site while approvals, finance or a subdivision are finalised. Sellers use them to secure a committed buyer without waiting for the same things.
We prepare option deeds for buyers and sellers, and review deeds prepared by the other side.
What the Deed Covers
The Terms That Matter
Everything the parties would negotiate in an ordinary sale, plus the option mechanics.
Option Fee
The amount paid for the option, who holds it, and whether it is credited against the deposit or price when the option is exercised.
Option Periods
When the call option can be exercised, when the put option can be exercised, and what happens if neither is.
The Annexed Contract
The full contract of sale, including special conditions, that becomes binding on exercise.
Nomination and Assignment
Whether the buyer can nominate another party or assign the option, and the duty consequences of doing so.
Caveat
A buyer holding a call option generally has an interest that supports a caveat, protecting the option on the title.
GST and Duty
How GST applies to the sale and when duty becomes payable, planned before the deed is signed.
Step by Step
How an Option Deal Runs
From agreed terms to settlement.
Terms Agreed
Price, option fee, option periods, settlement date and any conditions are agreed between the parties.
Contract Prepared
The contract of sale is prepared or reviewed, because it becomes binding exactly as annexed.
Option Deed
We draft the deed, or review the other side's draft, with the contract attached.
Sign and Protect
The deed is signed, the option fee is paid and a caveat is lodged where appropriate.
Exercise
The option is exercised by notice in the form the deed requires, and the deposit balance is paid.
Settlement
The contract proceeds to settlement in the usual way.
Our fixed fee for a put and call option deed is set out on our pricing page.
View Our Fixed FeesWhy the Annexed Contract Matters
Once an option is exercised, the parties are bound by the contract attached to the deed. There is no second chance to negotiate.
Everything a buyer would normally raise in a purchase - special conditions, disclosure, the settlement date - has to be settled before the option deed is signed.
Related property services.
Frequently Asked Questions
What is the difference between a call option and a put option?
Is the option fee refundable?
Can I nominate someone else to buy?
Should I lodge a caveat?
When is stamp duty paid?
Do you act for sellers too?
Securing a Property With an Option?
Send us the agreed terms and the property details, and we will outline the deed and the steps.
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