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Your Ultimate Guide to Buying a Property via Private Sale: 4 Crucial Must-Haves

Making an offer on a property that is on the market via 'private sale' is very different than buying an auction. It is crucial that you understand the essential components of an offer, when the property you want to buy is on the market as a 'private sale' and what elements of your offer protect you.

The 4 crucial must-haves when making your offer are:

  1. The price you are offering

  2. The settlement time frame you are offering

  3. Any conditions to the offer

  4. Inclusion of a Finance Approval date

Let's explore these in more detail.

The price you are offering

When you make an offer via private sale, you have to specify a specific price that you are going to pay on your offer. The difficult task is choosing what price to put on your offer.

It is dangerous to assume that a real estate agent will always come back and negotiate with you after you have made your offer. Some agents will, other agents will ask you to put your best offer in up-front.

So do your research before choosing your offer price. Have your broker run a 'mock property valuation' to give you the market range on the property so you can see where your intended offer price sits.

Then decide on what you are willing to pay to secure this property and what wiggle room you have if you are required to up your price (assuming the agent in question will entertain a negotiation). Low balling your offer at the bottom of the range rarely helps any buyer. Offering a fair price will better serve you.

Remember a seller wants the best possible price for their property. If you know what the property may likely be worth and what you are willing to pay for the property, then hopefully you can find a figure that is attractive and works for both you and the seller.

Settlement time frame

Sometimes a contract will be quite broad and give you the option of a 30 day, 45 day or 90 day settlement (and sometimes even longer). Other times, the seller in question may want a particular settlement time frame and favour offers which give them that timeframe.

Work with the real estate agent to find out as much as you can about what the seller is looking for and what their circumstances are and tailor your settlement time frame accordingly. If you offer a longer settlement but the seller ideally wants a shorter settlement, it could disadvantage your offer.

Choosing the right settlement timeframe could put you ahead of another similar offer.


Real estate agents would love you to make an unconditional offer straight up. The danger in doing so is that this means that you must buy the property no matter what, even if there is an issue with your finance, or the valuation falls short.

Always protect yourself and consider a 'subject to finance clause'. Importantly receive advice off a conveyancer about the wording of this clause prior to making an offer, to best protect you.

Other clauses which can be included in an offer are 'subject to a building inspection' or 'subject to a building and pest inspection'. The nature and type of the property you are buying may determine whether it is important for you to consider such clauses.

Naturally a seller may favour an offer which has fewer clauses. However as a buyer, you want to protect yourself as much you possibly can, in case there is an issue with the property you have bought.

Always ensure that you have been preapproved on your loan before making an offer.

Finance approval date

As a mortgage broker, this is one of the crucial components I recommend when making an offer. The finance approval date is the date up to which you, as the buyer, can walk away from the contract without losing any money.

The finance approval date gives the bank time to consider the property you have purchased and, if required, complete a valuation.

Your aim is that your loan goes unconditional prior to the expiry of your finance approval date. Having your loan already fully assessed and preapproved will help to achieve this. Not only does it tell you where you stand in the first place, it means that your loan can be turned around a lot faster than if you were starting from scratch and applying for a loan after you have bought.

Often during the finance approval stage, the real estate agent may not require you to put down the 10% deposit until this time has expired, but this is at the discretion of the agent selling the property you are interested in.

Importantly, a finance approval date gives you as the buyer a 'get out' option until your loan goes unconditional. The more you can protect yourself as a buyer, the better.

If you would like advice on what finance approval length of time is recommended or any of the above crucial components of an offer, please contact me.

This information is of a general nature only and should not be relied upon without first seeking personal advice relating to your situation.


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