A Step-by-Step Guide to Making an Offer

Making an offer on a property means expressing your willingness to purchase the property at a certain price and under specific conditions. Here’s a breakdown of the process and key steps involved:

  1. Get Finance Pre-approved:
    • Ensure you have pre-approval for a loan to cover the purchase.
    • If sold via private treaty, the bank may send a valuer to assess the property’s value.
  2. Legal Advice:
    • Engage a solicitor or conveyancer to review the contract.
    • Look for someone experienced with similar property transactions.
  3. Research Similar Properties:
    • Check recently sold properties in the area to gauge a reasonable offer.
  4. Attend the First Open Inspection:
    • Gauge interest and inquire about the number of parties attending.
    • Form a good relationship with the agent to show seriousness.
  5. Decide on Offer and Conditions:
    • Consider both price and conditions attached to the offer.
    • Conditions may include finance approval, building and pest inspections, settlement terms, etc.
  6. Put Offer in Early:
    • Consider making an offer early if there is low interest, putting you in a better negotiation position.
  7. Offer Your Best Price:
    • The highest offer may not always win; conditions also matter.
  8. Pay the Deposit:
    • Pay a holding deposit or expression of interest deposit to formalize the offer.
    • Deposit amount is often around 10% of the purchase price.
  9. Get a Response from the Vendor:
    • Liaise with the agent for a timely response.
    • If accepted, there’s a predetermined time to meet any conditions attached.
  10. The Vendor Signs the Contract:
    • Once conditions are met and the cooling-off period (if applicable) has elapsed, the offer becomes unconditional.
    • Completion of paperwork finalizes the purchase.

Offering Less than Asking Price:

  • If offering less, provide reasons and evidence, considering the market trends.
  • Discuss with the agent and consider sweetening the deal by waiving certain conditions.

When to Make an Offer:

  • Make a formal offer as quickly as possible.
  • Closer to an auction, vendors may be less likely to accept early offers.

Withdrawing an Offer:

  • Once a contract is signed, a deposit is paid, and the cooling-off period has passed, withdrawing an offer may incur penalties.
  • Changing your mind before signing the contract usually does not incur penalties.

Important Considerations:

  • Maintain open communication with your legal expert and the agent.
  • Understand the market conditions and justify any variations from the asking price.
  • Each step in the process has specific timelines and conditions, so careful attention is crucial.