What Is a Cooling-Off Period in NSW, and Is It Negotiable?
Five business days, one small forfeit, and a long list of situations where it doesn’t apply at all. Here’s how the cooling-off period really works.
What is a cooling-off period in NSW, and is it negotiable?
It’s the time period after contracts are exchanged when a buyer can withdraw from the contract, should they change their mind and walk away from the signed contract. The standard time of a cooling-off period is 5 business days but if agreed to by the seller, can be up to 10 business days. If the buyer withdraws during the cooling-off period, they will lose (forfeit) the initial deposit of 0.25% of the agreed purchase price plus any legal costs involved.
At a glance
- How long is the cooling-off period? 5 business days, ending at 5pm on the fifth business day after exchange.
- What does it cost to pull out? 0.25% of the purchase price is forfeited. The rest of the deposit is refunded.
- Is there cooling-off at auction? No, and none on a same day exchange after a property is passed in.
- What about off the plan purchases? A longer period of 10 business days applies.
- Is it negotiable? Yes, it can be extended, shortened or waived, but only if the seller agrees.
When does the cooling-off period start and end?
It starts the moment the contract is made, which is when contracts are exchanged. Not when your offer is accepted, and not when you pay money to the agent. Until exchange happens there is no contract, so there is nothing to cool off from.
It ends at 5pm on the fifth business day after exchange. Business days exclude weekends and public holidays, so exchange on a Thursday means the period runs out at 5pm the following Thursday. A public holiday in the middle pushes it out a day.
On most purchases you only pay the 0.25% at exchange, with the balance of the deposit due once cooling-off expires. Once the period ends without either side pulling out, the contract is unconditional and you are committed to settling.
What does it cost to pull out?
If you rescind during the cooling-off period, the seller keeps 0.25% of the purchase price and the balance of anything you’ve paid is refunded. You don’t have to give a reason, but you do have to give written notice before 5pm on the final day.
- $600,000 purchase: $1,500 forfeited
- $750,000 purchase: $1,875 forfeited
- $900,000 purchase: $2,250 forfeited
- $1,200,000 purchase: $3,000 forfeited
That is the whole cost of changing your mind. Compared with the cost of losing a property you actually wanted while you wait for every report to land, it’s usually the cheaper risk.
“Which is going to cause more tears? Losing the deposit or losing the house?”
When there is no cooling-off period
Plenty of NSW purchases have no cooling-off period at all. There is none where:
- You buy at public auction. Winning bidder signs and it’s unconditional on the spot
- The property is passed in at auction and you exchange later that same day
- Your conveyancer gives the seller a 66W certificate waiving it
- The contract is made by exercising an option, unless that option is void under section 66ZG
- The property isn’t residential, including rural land over 2.5 hectares
Buying off the plan works the other way. Those contracts carry a longer 10 business day cooling-off period, because you’re buying something that doesn’t exist yet.
What buyers are told
“Just sign it, you’ve got a cooling-off period if you change your mind.”
“You can get out of it for nothing.”
“There’s plenty of time to sort the rest out.”
What actually happens
Getting out costs you 0.25% of the price, and the clock is 5 business days, not 5 weeks. A pest and building inspection, a strata report and unconditional finance all have to fit inside that window. Agents aren’t allowed to give you legal advice, so “you’ve got cooling-off” is not a reason to sign something nobody has read for you.
Check which contract edition you’re signing
The Law Society and REINSW released the 2026 edition of the Contract for the Sale and Purchase of Land on 2 March 2026, replacing the 2022 edition. Since 1 June 2026 it’s the only compliant version, and the 2022 edition was withdrawn from sale on 13 March 2026.
The reason it matters here is that the cooling-off notice itself changed. The Conveyancing and Real Property Amendment Act 2025 amended the prescribed form, removing the words “to purchase the property” from the list of situations where cooling-off doesn’t apply. The effect is that the exclusion now covers options to compel a purchase, known as put options, not just options to buy. That closes a gap the Supreme Court had highlighted.
The statement in your contract is the one prescribed by section 66X of the Conveyancing Act, and it has to be clearly legible and prominently located. If you’re handed a contract that was drafted months ago on the old edition, tell us before you sign. It’s a quick thing for us to check and an awkward one to fix afterwards.
Is the cooling-off period negotiable?
Yes. It can be extended, shortened or removed entirely, but it takes agreement from both sides and it needs to be written into the contract before exchange. A seller is under no obligation to say yes.
Buyers commonly ask for a longer period to get formal loan approval, to fit in inspections, to arrange a valuation, or to line up a property they’re selling. You don’t have to give a reason, though it usually helps.
It runs the other way too. Sellers and agents often push for a shorter period or a 66W as the price of accepting your offer, particularly when there are other buyers circling. Waiving it is a genuinely strong negotiating position, as long as everything on your side is already done.
What to do during the cooling-off period
Treat it as a deadline, not a breather. Five business days goes quickly, and everything below needs to be finished before it expires.
Get the contract reviewed properly
Your conveyancer goes through the price, deposit, settlement date, inclusions, special conditions and the planning certificate, and tells you what the risks actually are. Ideally this happens before you exchange, not during.
Book your inspections straight away
A pest and building inspection, and a strata report if it’s a unit or townhouse. Book on day one, because a report that lands after 5pm on day five is useless to you.
Get finance to unconditional
Pre-approval is not approval. Tell your lender or broker the date your cooling-off period expires and ask them to confirm they can meet it, including the valuation.
Get an insurance quote
Premiums swing enormously between addresses, especially in bushfire and flood areas. Quote the actual property now, while walking away still only costs 0.25%.
Have the balance of the deposit ready
The rest of the deposit, usually up to 10%, falls due when the cooling-off period ends. Check your bank’s daily transfer limits before then rather than on the day.
Exchanged with a cooling-off period? Send us the contract today so we can use every one of those 5 days.
What is a 66W certificate?
A 66W is the document that waives your cooling-off rights. It’s signed by your conveyancer or solicitor, not by you, and only after the risks have been explained to you. Once it’s given, you can’t rescind. You’re locked in.
Before we’ll issue one, we want to see:
- The full deposit paid into the agent’s trust account
- The contract reviewed, with anything we’ve asked for negotiated and included
- Unconditional loan approval if you’re borrowing
- Your inspection reports back, and you’re happy with them
Used well, a 66W is a negotiating tool rather than a risk. A seller choosing between two similar offers will take the one with no cooling-off attached, which is exactly why agents ask for it. Read more about waiving your cooling-off period before you agree to one.
Is there a cooling-off period when selling?
No. Cooling-off protects buyers only. Once contracts are exchanged the seller is bound, and there’s no equivalent window to change their mind.
That asymmetry is the point. The buyer gets a few days to finish their homework, and in exchange the seller gets certainty that the property is under contract instead of still being shopped around. Sellers who want to be sure a sale is locked in should be talking to their conveyancer about a 66W, not waiting and hoping.
How to actually pull out
You rescind by giving written notice to the seller or their legal representative before 5pm on the last day. The contract sets out who the notice has to go to and how it can be served, and getting that wrong is as bad as not sending it.
Don’t do it yourself. Tell your conveyancer as early in the day as possible and we’ll serve the notice correctly and keep proof of delivery. One day late and the contract is unconditional, which means you’re buying the property.
The short version
Five business days from exchange, ending at 5pm, costing 0.25% if you use it. No cooling-off at auction, and none once a 66W is given. It’s negotiable if the seller agrees, and it’s a deadline for your inspections and finance rather than a chance to relax. The buyers who get burnt are the ones who treated it as breathing room.
Offer accepted?
Talk to Justin, Julie, Amanda or Nicole today. We’ll review your contract, tell you whether to exchange with a cooling-off period or waive it, and make sure the deadline doesn’t beat you.
