Off-Market Acquisition of Development Sites in Australia

Off-market acquisition covers three different things, and the difference between them matters more than the label does. The first is pre-market stock: an agent holds the listing, has an agency agreement signed, and is working a short list of buyers before the campaign goes live. The second is a private or silent listing, where the owner has engaged an agent but has instructed that the property is never advertised. The third is a genuinely unlisted site, where no agent is acting and the developer has approached the owner directly. All three get called off-market. Only the third takes the developer outside the agent conduct framework, and it is the one where the price discipline, the disclosure package and the paperwork discipline all have to be supplied by someone else, usually the buyer.

Before considering an off-market acquisition, you’ll need professional advice from a lawyer and an accountant. The reason is that the parts of an off-market deal most likely to hurt you are not the parts you negotiate. They are obligations that attach to the transaction whatever the parties agreed: a withholding obligation that falls on you as purchaser if the vendor turns up to settlement without a clearance certificate, duty that can attach to an option fee before you have decided to buy anything, a vendor statement that is defective and hands one side a right to walk months later, and a foreign investment position that can make the acquisition unlawful rather than merely expensive. Your lawyer decides what the contract, option deed and disclosure package have to contain in the relevant state or territory. Your accountant decides how goods and services tax (GST), withholding and income tax actually work on your structure and your numbers. This guide is written to make those two conversations shorter, and the section near the end sets out the questions worth putting to each of them.

Rates, thresholds and dates below were current at the date of writing and they change, sometimes quickly. Each is linked to the source that publishes it, and that source rather than this page is where to confirm it before relying on it.

What does off-market actually mean for a development site?

It means the site was not exposed to an open, advertised sale process, and nothing more than that. It does not mean the owner is uninformed, motivated, or unrepresented, and it does not mean the price is below market. Those are separate questions.

The three categories behave differently:

Pre-market. An agency agreement is in place and the agent is running a controlled introduction to a handful of buyers. The agent’s duty runs to the owner. New South Wales publishes rules of conduct for property agents which state that agents “must act in the best interests of their clients at all times”, so the person managing the process you are in is working for the other side of it. That is not a criticism of agents, it is the structure.

Private or silent listing. Same agency structure, but the owner has a reason for confidentiality: a tenant who does not know, a family arrangement, a competitor who should not find out that a strategic site is available. The confidentiality is usually the point, and a developer who breaches it tends not to see the next one.

Genuinely unlisted. No agent, no campaign, no disclosure package prepared, and frequently no lawyer engaged on the vendor’s side at the point of first contact. This is where most of the specific risk in off-market acquisition sits, and where the rest of this guide spends its time.

A useful working distinction is whether anyone in the transaction is being paid to run a process. If nobody is, then the process is whatever the developer builds, and the gaps in it are the developer’s problem.

Where do developers find off-market development sites?

From five main sources: agent relationships, publicly available planning and land data, direct approaches to owners, estate and succession situations, and lender-driven or otherwise forced sales. Site amalgamation of neighbouring holdings sits across several of them.

Agent relationships and pre-market flow

Most off-market stock that actually transacts reaches a developer through an agent who has decided they are a credible buyer. Credibility here tends to mean a demonstrated ability to exchange without a finance condition falling over, a track record of not retrading a price after due diligence, and a reputation for keeping a confidential listing confidential. None of that is a strategy, it is just consequence.

Publicly available planning and land data

A considerable amount of what a site sourcer needs is published and free, and it is under-used because it takes patience rather than money.

In New South Wales, the Planning Portal’s application tracker lets anyone “search and track the real-time status of development applications from lodgement to determination”, filtered by council, address, development type and lodgement date. That record is a sourcing signal in several directions at once. A refused application on a site may indicate an owner who has spent money and lost enthusiasm. A consent that has sat unbuilt for years may indicate an owner whose funding never arrived. A neighbour’s approval may reset what is achievable on the lot beside it. The section 10.7 planning certificate is where the controls and constraints on a specific parcel are recorded, and it is the document to read before drawing any conclusion from a tracker entry.

In Victoria, VicPlan is described by the Department as “a state wide map viewer for location based planning scheme information”, and it produces a free planning property report containing the zone and overlay information for a selected property or parcel, with maps linked through to the relevant sections of the planning scheme, including bushfire management overlay and bushfire prone area information. The Department states that the zone and overlay spatial data is updated weekly.

Sales evidence is also published. The New South Wales Valuer General publishes property sales sourced from notices of sale lodged with Land Registry Services, with individual property sales available since 2001, street and suburb sales for the last five years through an interactive map, and bulk data reaching back to 1990. Each record generally carries land size, contract price, purchase price and adjusted land value.

There is a trap in that last one worth naming. The Valuer General states that the sales information on the website “is available for non-commercial use only under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 licence”, and that commercial use requires a paid Property Sales Information licence. A developer building an internal acquisition model or a client-facing report on that data is not obviously making non-commercial use of it, and the terms of the relevant licence are a question for the lawyer rather than something to assume.

Direct approaches to owners

Letterbox drops, cold calls, and door-knocking a target block. The law that applies here is dealt with separately below, because it is the part of off-market sourcing most often done without anyone checking.

Estate and succession situations

Property that has passed, or is passing, through an estate. This is a real and continuing source of unlisted development stock, and it comes with a sequencing problem rather than a price problem. It is covered in its own section below.

Lender-driven and forced sales

Where a lender is exercising a power of sale, or an owner is selling under pressure from a creditor, a marriage breakdown or a tax liability. Two points are worth holding. First, the terms on which a secured lender may sell, and the duties it owes the borrower in doing so, sit in the mortgage and in state property legislation, and what those terms permit in a given state is a question for the lawyer. Second, the assumption that a forced sale means a cheap sale is usually wrong, because the party selling generally has both an incentive and often an obligation to demonstrate that it tested the market.

Does going off-market actually get a better price?

Sometimes, and not for the reason usually given. An off-market purchase removes competing bidders, which can help. It also removes the market test that tells both sides what the site is worth, which can hurt, and it removes the conduct framework that constrains how price is represented.

That framework is worth understanding precisely. New South Wales Fair Trading’s published guidance on underquoting states that “an agent is underquoting the selling price of a residential property if they make a statement or publish an advertisement about its price that is less than their reasonable estimate of the property’s likely selling price”, with a penalty infringement notice of $2,200 and a fine of up to $22,000 on conviction, together with loss of commission on the underquoted property. The guidance addresses agents and residential property. Where no agent is acting, that framework has nothing to attach to, so a developer negotiating directly with an owner is operating without the price signals it produces, in both directions.

What replaces it, in practice, is the developer’s own evidence. Published sales data, a valuation, and a feasibility that has been run on verified inputs rather than hopeful ones. The highest and best use assessment tends to do more work in an off-market negotiation than in a campaign, because there is no bidding to reveal what other developers think the site can carry.

The other consideration is what an off-market price does to the rest of the capital structure. A price agreed without a competitive process still has to be supported by an independent valuation when a financier assesses it, and a valuation that lands below the contract price is a funding problem rather than a negotiation problem. Whether that gap can be bridged, and on what terms, is a matter for the developer’s own funding conversation rather than something this guide can answer.

A worked example of where the off-market premium goes

Take a project with a gross realisation of $12,000,000 and a target development margin of 20 per cent on cost, using the definitions in the guide to development margin on cost versus revenue.

Costs other than land:

At a 20 per cent margin on cost, total development cost is $12,000,000 divided by 1.20, or $10,000,000, and profit is $2,000,000. That leaves a land line of $10,000,000 less $7,400,000, or $2,600,000, and the land line has to absorb transfer duty and acquisition legals as well as the purchase price. Assume those come to $140,000 on a site of this size, which means the price the project supports is around $2,460,000. Duty is the largest part of that $140,000 and it varies by state and by value, so the relevant revenue office calculator is where to establish it rather than a rule of thumb.

Now change two inputs, which is what an off-market deal often does. The owner will transact at $2,750,000, and wants a twelve month option period rather than a three month due diligence period because a tenant’s lease has to run out first. The extra nine months of holding and finance costs adds $90,000, so costs other than land become $7,490,000. The land line becomes $2,750,000 plus the same $140,000 of duty and legals, or $2,890,000, before any increase in duty on the higher price.

Total development cost is now $7,490,000 plus $2,890,000, or $10,380,000. Against an unchanged gross realisation of $12,000,000, profit is $1,620,000, and the margin on cost is 15.6 per cent.

The point is not that the deal is bad. It is that the $290,000 of price above what the project supported, and the $90,000 of extra time, came out of the same place, and the arithmetic shows exactly how much. Land holding costs during a long control period are the line most often left out of an off-market appraisal, because the period is being negotiated at the same time as the price.

What does an exclusive agency agreement mean if you approach the owner directly?

It can mean the owner owes commission on your purchase even though no agent introduced you, which is a deal-stage problem rather than a paperwork one.

New South Wales publishes the distinction between agency agreement types plainly. Under an exclusive agency agreement, the agent may be entitled to commission “if the property is sold during the fixed term of the agreement, even if the property is sold by you or by another agent”. Under a sole agency agreement, by contrast, “if you find a buyer who has not been introduced by the agent, then no commission is payable to the agent”. Under an open or general listing, only the agent who finds the buyer is paid. The state also states that the cooling-off period for an agency agreement for residential property is one business day, ending at 5pm on the next business day or Saturday.

The practical consequence for a developer approaching an owner directly is that the owner’s net proceeds may be materially lower than the owner thinks, and the owner may not discover that until their lawyer reads the agency agreement. Deals fall over at this point, late, after both sides have spent money on due diligence. The trap is that the question is easy to ask early and awkward to ask late.

It is worth noting that these rules are published by each state and territory and the position differs between them, so the agreement in front of the owner, read by their own lawyer, is what governs rather than the general shape described here.

What rules apply to approaching landowners directly?

Three separate regimes apply to a direct-to-owner campaign, and a developer running one without checking them is exposed in a way that has nothing to do with property law.

Telemarketing. The Australian Communications and Media Authority administers the Do Not Call Register, and states that telemarketing calls are permitted from 9am to 8pm on weekdays and 9am to 5pm on Saturdays, are not allowed on Sundays, and are prohibited on national public holidays. The Authority also states that telemarketers must tell the person their name, the name of their employer, and the name of anyone they are calling on behalf of, must say why they are calling, must end the call if asked to, and must provide caller identification with a callback number. Whether a particular number may be called at all depends on the register.

Email and text campaigns. The Authority sets out three requirements for commercial electronic messages, and they cover both email and short message service messages. Consent is required before sending, and can be express or inferred from an ongoing relationship where the person “knowingly and directly” gave their address. The message must accurately identify the sender’s name or business name and include correct contact details, which must stay accurate for at least 30 days after the message is sent. Every commercial message must contain an unsubscribe option, presented clearly, honoured within five working days, free of charge, and functional for at least 30 days after sending. A scraped list of landowner email addresses taken from a title search or a public register is unlikely to satisfy the consent test on any reading of it.

Conduct in the negotiation itself. This is the one most likely to be overlooked. The Australian Competition and Consumer Commission publishes the factors a court considers in deciding whether conduct is unconscionable under the Australian Consumer Law, including “the relative bargaining strength of the parties”, “whether the weaker party could understand the documentation used”, “the use of undue influence, pressure or unfair tactics by the stronger party”, whether conditions were imposed that were not necessary to protect the stronger party’s legitimate interests, the willingness of the stronger party to negotiate, and the extent to which the parties acted in good faith. The Commission notes the list is not exhaustive.

Those factors map uncomfortably well onto the facts of a typical direct approach. A professional developer with a lawyer, a valuer and a funding line, dealing with an elderly owner who has no agent, no lawyer at the table, and an option deed in front of them that they have not read. None of those facts is unlawful on its own. Together they describe most of the factors on the Commission’s list, which is why the same set of facts tends to attract advice to slow the process down, insist the owner take independent legal advice, and document that they did.

What changes in due diligence when there is no vendor disclosure package?

The due diligence obligations do not change, but the sequencing does, and the sequencing is where off-market deals break.

In a campaign sale, the contract of sale and disclosure documents exist before the developer sees the property. Off-market, the developer is frequently negotiating a price before the vendor’s lawyer has been engaged, which means the disclosure package arrives late, incomplete, or drafted by someone doing their first development site in years. The consequences of a defective package are real in most states.

Victoria. Consumer Affairs Victoria states that the vendor statement under section 32 of the Sale of Land Act 1962 (Vic) “must be provided to a prospective buyer before they sign the contract of sale”, and that “a contract is not binding on a buyer if a section 32 is not provided or is incomplete or inaccurate”. The statement covers, among other things, mortgages, improvements, easements, planning controls, and rates and taxes. Consumer Affairs Victoria also states that the seller or their agent must make the due diligence checklist available to prospective buyers at open for inspections and through their websites.

Queensland. The Queensland Government states that from 1 August 2025 a seller must give the buyer a seller disclosure statement, form 2, before the contract of sale is signed, under the Property Law Act 2023 (Qld), and that the scheme applies to residential property, commercial property and vacant land. The statement must cover matters including title information, encumbrances, zoning, environmental listings, building notices and pool information, and the Government notes that structural soundness and flooding history are not among them. On remedies, the Government states that “the buyer may be able to terminate the contract if the seller does not comply with the scheme”, at any time up to settlement, whether disclosure was withheld or was inaccurate or incomplete. Exemptions include government and listed corporation buyers, related party transactions, sales above $10 million where the buyer waives the requirement, and councils recovering unpaid rates.

New South Wales. The planning certificate issued by the council for the land is the document a purchaser would usually read first, and what it does and does not record is set out in the guide to the section 10.7 planning certificate.

Everywhere else. South Australia, Western Australia, Tasmania, the Australian Capital Territory and the Northern Territory each set their own position on what a vendor must disclose and what happens when they do not, and the current requirement in the relevant jurisdiction is a question for the lawyer rather than something to carry across from another state. The general pattern that a defect in disclosure tends to operate in the buyer’s favour is not a safe assumption to trade on, because in an off-market deal the buyer is often the party who needs the contract to hold.

There is a second-order effect worth naming. A right to terminate is only useful if terminating is what you want. A developer who has spent nine months and real money on design, consultants and a planning strategy, and then finds the disclosure was defective, has a remedy they do not want to use. The defect is bargaining power on price and little else, and bargaining power is worth less than a site.

How do developers control an off-market site without buying it yet?

Usually with an option, a long settlement, or a contract conditional on a development approval, and in New South Wales at least, the duty consequences of the first of those now start earlier than many developers expect.

Revenue NSW states that from 19 May 2022, duty applies to the grant of an option under section 8(1)(b)(ix) of the Duties Act 1997 (NSW), on the basis that an option over dutiable property is a change in beneficial ownership, so the call option fee is subject to ad valorem duty. Revenue NSW also states that the option fee includes GST if applicable. Where the option is transferred, section 9B makes the transferee liable for duty, and that includes nominating a nominee to exercise the option, nominating a new purchaser before exercise, and novating the option to another party, with duty assessed on the greater of the consideration paid and the unencumbered value of the option. Section 64D provides a credit on exercise for duty already paid on the transfer of the option. Separately, where paired put and call options exist, Revenue NSW states that call option assignment duty under Chapter 3 is payable by the assignor on the dutiable value of the land, calculated as though the property itself were being transferred, with exemptions under section 111 including transfers between licensed home builders and members of a corporate group.

The full mechanics of how these structures are built, and what each party is actually agreeing to, are in the guide to put and call options. The position differs in other states and territories, and the current treatment is a matter for the relevant revenue office and the developer’s own adviser.

Where the control mechanism is something short of a registered interest, a caveat is often part of the conversation, and whether the developer has a caveatable interest at all depends on what the deed actually grants.

Three questions tend to decide whether a control period is worth what it costs. How long the period is, and what is being paid for it. What happens to the option fee if the option is not exercised. And whether the owner can deal with the land in the meantime, which is a drafting question rather than a commercial one.

Which tax and withholding obligations land on the buyer in an off-market deal?

Two in particular, and both are easier to miss when there is no agent and no standard-form process moving the parties along.

Foreign resident capital gains withholding. The Australian Taxation Office (ATO) states that “from 1 January 2025, a rate of 15% applies to the value of all property”, with no property value threshold. An Australian resident vendor must obtain “a valid clearance certificate issued by us at, or before settlement”, and the ATO states that “without a clearance certificate, foreign resident capital gains withholding must be withheld from the sale proceeds by the purchaser and paid to us”. The obligation is the purchaser’s. In an off-market deal with an unrepresented vendor who has never sold a development site, the clearance certificate is a document nobody may have thought about until the week of settlement, and 15 per cent of the purchase price is not a rounding error on a settlement statement.

The margin scheme. The ATO states that the parties “must have a written agreement to use the margin scheme before settlement”, and that a seller is generally unable to use the scheme if the previous owner was not eligible to use it. Both matter at acquisition rather than at sale, because the eligibility of the eventual sale depends on how the site was acquired and on what the contract said at the time. The wider treatment is in the guide to GST on property development, and the specific position on a specific site is a question for the accountant before exchange rather than after it.

A third consideration sits behind both. Whether there is any GST to recover on the land at all depends on the vendor’s own registration position and on the character of the supply, and a private owner selling a family holding is in a different position from a company selling trading stock. That is not a detail to resolve at settlement.

What does buying from a deceased estate involve?

It involves a sequencing problem: the person who wants to sell may not yet have the legal authority to do so, and the developer’s timetable has to accommodate that rather than push against it.

The Supreme Court of New South Wales states that a grant of probate “is a legal document that authorises an executor (or executors) to manage the estate of a deceased person in accordance with the provisions of the deceased’s will”, and that depending on the type, size and value of the assets in New South Wales a grant may not be necessary. For real property specifically, the Court indicates a grant will be required where the property is “held solely in the name of the deceased or a share of real estate is owned by the deceased as tenants in common”. Where the property was held as joint tenants, it passes to the surviving co-owner without a grant. The Court also states that where an application is filed more than six months after death, an explanation accounting for the delay must be given.

There is a second timetable running alongside that one. Legal Aid NSW states that an application for a family provision order “must be made to court within 12 months from the date of the deceased’s death”. What a pending or possible claim means for an executor’s ability to sell, and for a purchaser’s position if one is made after exchange, is squarely a lawyer’s question, and it is one worth asking before the contract is drawn rather than after. The equivalent position in other states and territories differs and is set by their own succession legislation.

The practical shape of these deals is therefore about patience and about contract drafting. An executor who has not yet obtained a grant cannot give a clean settlement date, and a developer who needs one either waits, or structures around the wait, or moves on.

Does foreign ownership change what can be bought off-market?

It changes what can be bought at all, so it sits before price rather than after it. Our guide to foreign investment approval covers the approval process itself.

Australia’s foreign investment guidance on residential land states that foreign investors generally must notify the ATO before acquiring residential land “regardless of value”. It also states that from 1 April 2025, “foreign investors are generally prohibited from purchasing established dwellings”, with limited exceptions, for a period set out in the current guidance. For vacant residential land, approvals typically carry construction conditions, including completing construction “within 4 years and the land not being sold until the construction is complete”, while conditions for non-residential redevelopment are assessed case by case. Buyers must also register the purchase with the Register of Foreign Ownership of Australian Assets, and an annual vacancy fee may apply where a property is unoccupied or unavailable for rent for more than 183 days in a year.

Two things follow for off-market sourcing. First, whether an entity is a foreign person for these purposes turns on its ownership and control rather than on where it was incorporated, so a locally registered company with offshore shareholders needs the question answered properly before it signs anything. Second, the construction and no-sale conditions on vacant residential land approvals cut directly across a strategy of acquiring, obtaining an approval and selling the approved site on, which is a common off-market play. Whether that strategy is available to a particular purchaser is a legal question with a binary answer, and it is not a condition to be negotiated with the vendor.

How does off-market sourcing work in New Zealand?

The sourcing behaviour is similar and the overseas investment overlay is different, which is the part an Australian developer is most likely to get wrong.

Land Information New Zealand states that Australian and Singaporean citizens may purchase a house or land with a property category of “residential” or “lifestyle” without consent. Where the land is residential and otherwise sensitive, such as property on islands or near beaches, additional requirements apply depending on residency status. An overseas person must complete a residential land statement confirming eligibility before purchase, and Land Information New Zealand notes that a lawyer assists with this.

The distinction that matters is between a citizen and a company. The exemption described above is framed around citizenship, and an Australian company or trust acquiring New Zealand land is a different analysis. So is land that is sensitive for reasons other than its residential category. Both are questions for a New Zealand lawyer before a price is agreed, because consent requirements are not something a vendor can waive.

How does an off-market site get into a feasibility before the disclosure package arrives?

By separating verified inputs from allowances, and labelling which is which, so that the appraisal shows where the risk actually sits rather than hiding it in a single land number.

On an off-market site the developer is usually asked to commit to a price with less information than a campaign would have provided. That is manageable, and the way it is managed is by being explicit about it. A site area from a title search is a verified input. A yield from a planner’s advice on the current controls is a verified input. A remediation allowance struck without a site investigation is not, and neither is a construction rate carried over from the last project on a different site. The feasibility model is more useful in this situation when the allowances are visible and separately sensitised than when they are buried.

Three things tend to separate an appraisal that survives contact with the site from one that does not. Whether it has been run at the price the project supports rather than the price being asked, so the gap is visible instead of argued about. Whether the control period has been costed, since an option or long settlement carries a holding cost even where no land tax or rates fall on the developer. And whether the developer has decided, before exchange, which unverified allowances are deal-breakers if they come back badly, because one who has not decided that in advance tends to absorb the bad news rather than act on it.

What to ask your lawyer

• Is the owner subject to an agency agreement, what type is it, and could commission be payable on a sale to me even though no agent introduced me?
• What must the vendor disclose in this state or territory before I sign, and what is my position if the package turns out to be incomplete or inaccurate after I have spent money on consultants?
• If we use an option, what is the duty treatment of the option fee, of any nomination or assignment, and of exercise, in this state, and who bears each amount under the deed as drafted?
• Does the deed give me a caveatable interest, and can the owner deal with the land during the control period?
• Given the way I intend to approach this owner, including any direct mail, calling or door-knocking, what are my obligations under the telemarketing, spam and consumer law regimes, and what should I document about the owner’s access to independent advice?
• Is my acquiring entity a foreign person for foreign investment purposes, and if so what conditions would attach to an approval on this land, including any restriction on selling before construction is complete?
• If this is an estate, has a grant been obtained, who can currently bind the estate, and what is my exposure if a family provision claim is made after exchange?
• How long does any existing development consent have to run, has it been physically commenced, and does it transfer to me on settlement?

What to ask your accountant

• Is this acquisition a taxable supply, is there any GST to recover on the land, and what does the vendor’s registration position mean for me?
• Will the margin scheme be available on the eventual sale given how I am acquiring the site, and does the contract need a written margin scheme agreement before settlement?
• What is my obligation as purchaser if the vendor does not produce a clearance certificate for foreign resident capital gains withholding, and how should the contract deal with the mechanics at settlement?
• Should the option fee and control period costs be treated as part of the cost base of the land or as something else, and how does that interact with the way I am financing the site?
• If the option is not exercised, what is the treatment of the money already spent?

What to ask your valuer and town planner

• What does the published sales evidence actually support for this site, as distinct from what the owner is asking?
• What is the current yield under the controls in force today, and what would need to change for the yield in my appraisal to be achievable?
• Which constraints on this parcel would only appear in a site investigation rather than a certificate or a report, and what is a defensible allowance for them at this stage?
• If I am relying on a neighbouring approval as a precedent, what about that site made it approvable, and does this one share those features?