Australia: Electronic conveyancing – the property world is morphing

Last Updated: 25 September 2018
Article by Anne Parnell and Peter English

Like most other professions and industries throughout Australia and the world, digital transformation is the norm. Property transactions in Australia are not exempt and are converting (at an accelerating rate) to electronic conveyancing.

What is Electronic Conveyancing?

Electronic conveyancing is where the sale of property, including exchange and settlement, is completed on an electronic platform. The platform known as the Property Exchange Australia Limited ("PEXA") has been developed and implemented over a number of years to facilitate a "virtual" settlement room.

What are the benefits to home owners, and buyers?

The Minister for Finance, Services and Property, Victor Dominello said, "These reforms will save home buyers time and money by reducing settlement delays, removing reams of unnecessary paperwork and preventing fraud." He also stated, "The changes will also benefit business by providing certainty and clear transition time frames for the implementation of digital conveyancing, and reducing costs associated with settlement."

The claimed additional and practical benefits include:

  • Higher security and reduced risk of identity fraud.
  • Eliminates errors as documents are checked prior to settlement.
  • On-line payout figures and confirmation of funds available to settle
  • Settlement and lodgement of the transfer will normally occur simultaneously, instead of at the convenience of the bank which can take weeks or months.
  • Eliminates paperwork processing, settlement agent's fees, and bank cheque fees.
  • Known readiness of other parties.
  • Immediate distribution of proceeds of sale after settlement.
  • Greater certainty of settlement success.
  • Documents can be lodged on-line 24 hours a day, 7 days a week.

Will it be secure?

PEXA has advised that over 1.2 million transactions have been successfully processed through the platform, and over $150 billion in property value has settled.

Many clients may feel unsure about the process and therefore about proceeding with an electronic conveyance, particularly after the recent media attention relating to fraudulent activity and the stealing of online funds. Anecdotally, this appears to be related to accessing the parties online banking access, not the PEXA system itself.

PEXA claim to have put in place several measures to ensure the integrity of electronic conveyancing. These include:

  • Verification of Identity – a PEXA subscribed representative is required to carry out a verification of identity of a client to ensure that a person is who they claim to be. These can also be done by third party representatives, such as at a participating Australia Post office.
  • Client Authorisation – Once you have been identified, then your representative is required to obtain a Client Authorisation Form in which you authorise them to sign and submit documents on your behalf as required for the electronic conveyance.
  • Digital Signature – These are used in the virtual room to sign financial statements as well as the transfer document. All documents, including the digital certificate have secure passwords in place for access and editing. Representatives are assigned to be "Signers" on the platform, and must also have their identity verified and authorised.
  • Electronic Certificate of Title ("eCT") – The practitioner will settle with an eCT, instead of the traditional hard copy title.

Further, PEXA has advised that extra security measures have been put in place by them to reduce the risk of fraud happening in the future, and that they have implemented a residential seller's guarantee, which applies to settlements occurring on or after 29 June 2018, to cover any lost vendor surplus funds.

PEXA Residential Seller's Guarantee ("PRSG")

If PRSG applies, the seller has the option to make a claim under the guarantee, rather than seeking to recover loss by an alternative means. The key points are:

  • The PRSG applies to sellers in respect of the settlement of residential property where the seller's funds are misdirected after the seller's practitioner has entered the correct bank account details into the PEXA Platform.
  • There is a $2 million cap on PEXA's liability per settlement.
  • Further conditions must be satisfied before a claim can be made under the PRSG.

When does it become mandatory?

In NSW, the Government has committed to a timeframe for the transition to electronic conveyancing stating: "By July 2019, all standard property transactions in NSW will be conducted electronically and all Certificates of Title will be phased out in favour of e-Titles."

The timetable to implement the transition, and over the next year the following dates and transitions is as follows:

1 July 2018

  • All standalone caveats must be lodged online.
  • All standalone transfers must be lodged online including transfers where there are no mortgagees and no other registry dealings involved, such as a discharge of mortgage. For example a cash buyer purchasing unencumbered property, or a related family transaction.
  • All standalone mortgages, discharges and refinances, must be lodged online.

1 October 2018

  • All remaining paper Certificate of Titles with Deposit Taking Institutions will be replaced with Electronic Certificate of Titles (eCT).

1 July 2019

  • All transfers, mortgages, discharges of mortgages or combination of these for the same folio must be lodged electronically, except where lodged with another dealing for the same folio and that other dealing cannot be lodged electronically.
  • All remaining paper certificates of title will be cancelled as well.


  • There are certain exceptions to the Conveyancing Rules, including where the folio of the register for the land is not electronically tradeable, and in such cases the transaction will be done in the normal paper channel.

A step in the right direction?

Although like many on-line platforms, buying or selling a property electronically does have its risks, there are many benefits to be gained and it ultimately is a step in the right direction towards greater speed and convenience for our property transactions. If you're in the market, make sure you engage a "PEXA ready" lawyer to ensure your electronic conveyance proceeds smoothly.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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