What is a deadline sale?
A deadline sale is a method of
selling a property where the seller sets a date and time for buyers to submit their offers.
Unlike an auction, buyers do not bid against each other publicly. Instead, each interested buyer submits their own offer, usually using an
Agreement for Sale and Purchase.
The seller then considers the offers received and decides whether they want to accept one, negotiate or reject them.
Can you make a conditional offer on a deadline sale?
Yes. An offer on a deadline sale does
not necessarily have to be unconditional.
Depending on your circumstances, you may want to include conditions relating to:
- finance
- a LIM report
- a building inspection
- a registered valuation
- the sale of another property
- other matters relevant to your purchase.
The conditions you include can be important because, if your offer is accepted, the Agreement for Sale and Purchase can become legally binding.
Before making an offer, it is worth discussing the agreement and appropriate conditions with your property lawyer.
Does the highest offer win a deadline sale?
Not necessarily.
Price is only one factor a seller may consider. They can also look at the conditions attached to each offer, settlement dates and other terms.
For example, a seller may prefer a slightly lower offer with fewer conditions over a higher offer containing several conditions.
The seller can accept an offer, negotiate with one or more buyers or reject all offers. They are not required to accept the highest offer, or any offer at all.
What does “deadline sale, unless sold prior” mean?
If a property is advertised as
“deadline sale, unless sold prior”, it means the property could be sold before the advertised deadline.
If the seller receives an offer they are happy with before the deadline, they may decide to accept it rather than wait for other offers.
If you are seriously interested in the property, let the real estate agent know. Don't automatically assume you can safely wait until the deadline before making your offer.
Deadline sale vs auction: what's the difference?
One of the biggest differences between a deadline sale and an auction is
transparency.
At an auction, you can see competing bids and know how much other buyers are prepared to pay.
With a deadline sale, offers are submitted privately. You generally won't know how many other offers there are, what price other buyers are offering or what conditions they have included.
Another important difference is that an auction purchase is generally unconditional, whereas a deadline sale allows buyers to submit conditional offers.
This can give you more flexibility to complete appropriate due diligence before becoming unconditional.
How much should you offer in a deadline sale?
Without seeing the other offers, it can be tempting to try to guess what competing buyers might pay.
Instead, consider what the property is worth to you, your budget and the terms you are comfortable offering.
Your offer isn't just about price. Conditions and settlement terms can also form part of what the seller considers when comparing offers.
What happens after the deadline?
Once the deadline has passed, the seller can consider the offers received.
They may choose to accept an offer, reject all offers or negotiate with one or more potential buyers.
If your offer is accepted, the Agreement for Sale and Purchase can become legally binding, subject to any conditions included in the agreement.
Get advice before you make an offer
An offer made in a deadline sale can become a
legally binding contract as soon as it is accepted by the seller.
Before signing, we recommend having your lawyer review the Agreement for Sale and Purchase and advise you on the conditions that may be appropriate for your purchase.
It is much easier to protect yourself before your offer is accepted than to try to resolve a problem afterwards. What is a Deadline Sale
Our experienced
Property Law team can review the agreement, property title and proposed conditions before you make your offer, helping you understand exactly what you are committing to.
Buying a property by deadline sale? Talk to our
Property Law team before you make your offer.
