Rebates can sometimes be offered as an inducement for a buyer to enter into a contract to purchase a property. They can commonly be offered by developers. Care must be taken as this can be seen as a misrepresentation of the purchase price and possibly an attempt to defraud a financier or the ATO.
The main issue is not the rebate itself, but whether it has been disclosed correctly. That is, the ‘true’ purchase price must be divulged.
There is a further issue in that the information contained in the transfer documents may distort the data kept on various land databases, thereby spoiling the integrity of that information. These databases store information that is widely available and may mislead valuers and/or buyers in the future.
We strongly recommend that a solicitor review any contract containing a rebate clause prior to entering into it.