Cooling-off period

A cooling-off period is the statutory window after a client signs a residential building contract during which they can rescind it without proving cause. The clock starts when the client receives a signed copy of the contract, not at signing.

Standard period: 5 clear business days in NSW, VIC, QLD, and SA. The trigger and notice rules are state-specific:

NSW: applies to residential building work over $20,000. Client gives a written rescission notice to the contractor (Home Building Act 1989 s 7BA). The period can only be shortened by a compliant lawyer’s certificate.
VIC: applies to major domestic building contracts. Builder may retain $100 plus approved out-of-pocket expenses incurred before withdrawal; the rest of any deposit is refunded (Domestic Building Contracts Act 1995 s 34).
QLD: clock starts the day after the owner receives the signed contract plus, where the contract is $20,000 or more, the QBCC Consumer Building Guide (QBCC Act Schedule 1B s 35). Builder keeps $100 plus reasonable out-of-pocket expenses on withdrawal.
SA, WA, TAS, ACT, NT: each jurisdiction sets its own rule. Confirm the relevant Act before quoting a figure to a client; the SA rule sits in the Building Work Contractors Act 1995.

For builders, three practical points. First, the period does not start until the client has the signed contract in hand; delaying delivery extends the client’s exit window. Second, oral or text-message rescission does not count: only a signed written notice triggers it. Third, if the client rescinds within the window, the builder must refund the deposit less the statutory retention and any approved out-of-pocket costs. Mobilising trades or ordering materials before the cooling-off period expires is at the builder’s risk.

Also known as: rescission period, withdrawal period.

Category: Contracts / commencement / consumer protection.

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