Making an offer from interstate or overseas

Learn the protocols and strategies for successfully negotiating a Victorian property purchase from afar.

Private Sale vs. Auction

In Victoria, there are two main ways to buy property: private sale and auction. In a private sale, you make an offer to the agent, who then presents it to the seller. This can involve negotiation on both price and terms, such as the settlement date or finance clauses. You should always put your offer in writing. A formal offer is usually made by signing the Contract of Sale with your proposed price and conditions. The seller can then accept, reject, or counter offer. This process can happen quickly, so you must have your deposit funds ready and your legal advice lined up.

Auctions are very common in Melbourne and are highly transparent but carry more risk for the buyer. An auction bid is unconditional, meaning you cannot include a cooling off period or a subject to finance clause. If you are the highest bidder above the reserve price, you are legally bound to buy the property. For remote buyers, you can bid via phone or appoint someone to bid on your behalf using a proxy form. Many agencies also use online bidding platforms like Gavl or AnyPresence, which allow you to see the auction live and place bids through an app.

The Risks of Unconditional Offers

Making an unconditional offer means that once the contract is signed by both parties, you are committed to the purchase regardless of whether your bank approves your loan or if you find a problem with the house. This is the standard for auctions but is also sometimes used in private sales to make an offer more attractive to a seller. As a relocating buyer, this is extremely risky. You must have a firm loan approval and have completed all your inspections before making such an offer. If you fail to settle on an unconditional contract, you will likely lose your full ten percent deposit and could be sued for any loss the seller incurs.

To mitigate this, always aim to include protective clauses in private sale offers. A common clause is 'subject to finance', which gives you a set number of days to get formal bank approval. Another is 'subject to a building and pest inspection'. Sellers in a hot market may prefer unconditional offers, but your financial safety should be your priority. Your conveyancer can provide the exact wording for these clauses to ensure they are legally enforceable. Never assume that a verbal agreement with an agent is binding; in Victoria, only a signed contract is legally valid for property sales.

Negotiating from a Distance

Negotiating from a distance requires clear communication and a firm understanding of your limit. Be prepared for time zone differences to slow down the process. It is often helpful to have a local representative, like a buyer's advocate, to handle the back and forth. They can read the body language of the agent and provide context that you might miss over the phone. When making an offer, consider not just the price, but also the terms that might appeal to the seller, such as a shorter or longer settlement period that aligns with their next move.

Always ask the agent for the Statement of Information to see the comparable sales they are using to justify the price. Do your own research to see if these sales are truly comparable in terms of land size, condition, and location. Don't be pressured by 'exploding offers' that expire in a few hours. Take the time to consult your team. Once an offer is accepted, you will need to pay a deposit, usually ten percent of the purchase price, which is held in the real estate agent's trust account until settlement. Ensure you have the facilities to make this transfer quickly, especially if you are moving money from an international account.

• Decide between auction or private sale
• Get legal review of the contract before offering
• Arrange a proxy if bidding at auction
• Include finance and inspection clauses in private sales
• Prepare deposit funds in an accessible account