How to make an offer

Article by Tania Butler-Kemp December 16, 2022
How to make an offer

There are very few resources for buyers on how to submit an offer, so we have written this to help you so take a few minutes to read on.

Timing

  • Offers can have a close date or be taken to the owners on a day by day basis so make sure you submit your offer prior to this time and ask the agent when offers are expected
  • If there is an offers closing date the property cannot be sold prior so you might have a bit more time than if offers are taken to the sellers when they come in.
  • We guarantee as a courtesy to buyers that all offers are confidential and one buyers price is not discussed with any other buyers.

Price - How much to offer

Price is the part of this process that attracts the most questions, with buyers often wanting to know how much it will take to secure the property but there is often no exact answer. The reality is that the final sale price is actually set by the buyers and the sellers do not always give agents an authorised sell price at the start of the campaign. The ‘+’ price method for our sales campaigns is a guide where only offers in excess of that figure will be considered. Please note if you are thinking to offer less than this figure then we would suggest it’s not worthwhile and we will try and help you find something cheaper. Properties can sell a little or substantially above the guide price and there is no exact % above which needs to be paid. When considering a price to offer, there may not be a second chance to increase it, so here are a few things to consider:

  1. A personal budget, what is the comfortable limit you can spend. Ask your lender the absolute maximum you can spend. It’s usually not an exact number such as $600,000, its more likely $612,000.
  2. Correlate your budget with the value seen in the home, remembering everyone sees value differently. To some it's the location, or maybe block size, some just like the feel of a home and others have a time frame they must purchase by.
  3. Consider what absolute, final price it would be ok to walk away at and purchase elsewhere. Buyers all too often think in round numbers. A great tip if you feel you would be happy to pay $600,000, for example, is to offer $607,350 instead. Ask yourself if you miss out on this property, what will you buy next and will you be ok looking for an alternative property.

Types of offers and how to present your offer conditional offers

These are offers that are normally subject to financial approval and valuations from the bank. However, the offer may also include a variety of conditions such as getting a 90-day settlement or early access. You should make any conditions obvious to the sellers as some are minor and others might be given leniency if your offer figure is attractive enough. There are several different ways to submit a conditional offer and they are all acceptable, depending on what suits you best. Its not a legally binding document so we do not need an original.

  1. Complete the ‘Conditional offer (Editable)’ form which is located in the relevant document section and email it back to us.
  2. Complete the form and then just take a photo of it and then email or SMS it to us.
  3. Email through your offer, (offers don’t have to be on the offer form) just send us a few lines about your price, terms, financial position as outlined in the offer form.
  4. Call through your offer and we can write it down for you, we do not need your signature.

Unconditional offers

Very important – an unconditional offer means there is no recourse to change your mind, meaning buyers must understand if the seller accepts their offer then they are legally bound to a binding contract to purchase. It’s this commitment that sellers love and let’s face it, you want them to love you and your offer. To put forward an unconditional offer you simply must be confident that you can afford the amount you are offering and that you’ve done your due diligence on the property as there is no cooling off period if your offer is accepted. For the seller, an unconditional offer means the offer is solid and they can move on with their life with certainty and focus on the settlement date. It also means they won’t need to wait the additional 2-3 weeks that it can take for a conditional offer to be formalised by the banks, so the seller can either move quicker or lock in their plans now. For the buyer, a successful unconditional offer is a protection for the buyer that they cannot be gazumped should their offer be accepted since it’s legally binding.

To present an unconditional offer please follow this free process:

1) To present an unconditional offer please follow this free process:

To ensure you are comfortable with the contract and there are no ‘subject to items’ please request a contract review with your solicitor.

  • Please note most solicitors will charge a buyer $250 - $500 for this however the solicitor we have referred above in the ‘Recommended Solicitor’ section will offer this to you for FREE for this property. You only pay for their services if you purchase the property.
  • The section 17 can only be obtained from this same solicitor and acts as a protection for you that you have been notified of the implications of buying a property without a cooling off period.
  • You do not need to meet the solicitor, they will simply email it to you and you can then forward it to us.

2) Email us your offer figure along with your preferred settlement timeframe and the section 17 document.

  • Please note pre auction offers need to be strong figures ‘over’ the current price guide in order to stop an auction campaign.
  • All offers are confidential so you can have confidence in knowing your offer will not be divulged to any other buyers.
  • We aim to come back to you asap and will usually have an answer from the sellers with 24 hours, 48 hours at the most.

3) Best and final offers will be called.

If you offer is not at an acceptable level then you can simply try a higher figure.

  • Once your offer price and terms are acceptable to the seller we will notify you, then we will call for best and final offers.
  • As a courtesy to other buyers we will send out a text asking for best and final offers, normally with a short period of around 24 hours.
  • Your offer figure will remain 100% confidential.
  • Please note this same courtesy will be offered to you should someone else submit an acceptable pre auction offer.
  • Should your offer be trumped by another buyer most sellers will as a courtesy give you the option to increase your offer.

4) Signing the contract.

  • We use digital signatures so we will email you the contract which can then easily and quickly be signed on your computer or smart phone.
  • To keep things simple and so the sale can be process quickly you won’t be required to print or scan anything.
  • Once both the buyer and the seller have signed the contract we will exchange the contracts making the purchase legally binding and secured for you.

5) Paying the deposit.

  • The deposit is then immediately due and we will send your our trust account details so you can EFT the 5% deposit.
  • Please note if your bank limits the amount you can transfer which is very common, you can simply request an increased transfer limit or make the payment over 2 or 3 transfers.
  • The seller will accept a minimum deposit of 5% deposit via EFT.
  • Alternatively if you are using a deposit bond it must be for 10% and we need the original copy of the bond.

6) Sold to you! Congratulations!

  • Well done, you have now purchased the property.
  • We will then arrange to meet you back at the property to put up a sold sticker, give you some champagne and of course take some happy snaps.

If you have any further questions about the offer process, please contact us, we’ll be happy to help.