Hi, normally if the Contract has gone unconditional, you will breach the Contract if you do not settle in January.
There are exceptions - mainly associated with the Seller being in breach of the Contract...
What type of purchase is it? off-the-plan or an existing property?
Are there any special conditions?
Have you conducted buyer searches on the property? have they revealed anything that would be a major issue?
If you are definitely not going to proceed with settlement... then it is best to attempt to negotiate with the seller on a "without prejudice" basis, and determine if there is an opportunity to locate a replacement buyer at the same or (if you are lucky) an increased purchase price... this could have stamp duty implications, and the real estate agent will most likely claim two commissions.. so you might incur losses, they just might be able to be limited if the matter is dealt with early... whereas if it is left to the last minute, the situation would most likely be worse, as there will be less time to deal with the situation, and the seller will most likely be under pressure from their financier to produce the settlement money.
Kind regards, James