How to Make an Offer on a Home: Your Step-by-Step Guide

Crafting a winning offer involves more than simply stating a number. It’s about preparation, strategy, and understanding both the property and the seller’s motivations. Whether you’re buying via private treaty or aiming to secure a home before auction day, these steps will help you submit a competitive, compelling offer.

Preparing to Make an Offer

Get Mortgage Pre-Approval

Securing pre-approval demonstrates to sellers that you have the financial backing to complete the purchase. Benefits include:

• Faster Transactions: You can move quickly once your offer is accepted.

• Budget Confidence: Knowing your borrowing limit helps you avoid overreaching.

• Seller Assurance: Vendors favour buyers who aren’t waiting on finance approval.

Define Your Budget and Priorities

Beyond your maximum spend, determine:

• Must-have Features: Number of bedrooms, outdoor space, or home office setup.

• Deal-Breakers: Structural issues, noisy streets, or restricted renovations.

• Flexible vs Fixed Settlement: Would you pay more for a quicker handover?

Research and Due Diligence

Study Comparable Sales

Analyse recent transactions of similar homes in the immediate area. Pay attention to:

• Sale prices vs listing prices

• Time on market

• Any price reductions

Ask the Seller Crucial Questions

Engage the agent or owner directly to uncover:

• Motivation for Selling: Quick sale, relocation, or downsizing?

• Desired Timeline: A longer settlement may be less attractive to some vendors.

• Property History: Past repairs, renovations, or boundary disputes.

Conduct Thorough Inspections

Arrange building, pest, and specialist inspections before finalising your offer. If issues surface—like rising damp or outdated electrical wiring—you can:

• Renegotiate the Price

• Request Repairs

• Ask for a Credit at Settlement

Crafting a Strong Offer

Include All Essential Terms

A formal written offer should clearly outline:

• Offer Price: The exact amount you’re prepared to pay.

• Deposit Amount: Typically between 5–10% of the purchase price.

• Settlement Date: When the balance is due (e.g., 30, 60, or 90 days).

• Conditions: Finance approval, satisfactory inspections, or sale of your own home.

Personalise Your Submission

A short letter to the seller can set you apart. Share why you love the home and how you’ll care for it. Genuine stories often resonate emotionally with vendors.

Use Professional Help

Even if you manage negotiations yourself, engage a conveyancer or solicitor to draft and review your offer. This reduces legal risks and ensures compliance with state regulations.

Pre-Auction Offers

Why Consider a Pre-Auction Bid?

• Avoid Competitive Bidding: Lock in the purchase without the stress of the auction room.

• Appeal of Certainty: Sellers may accept a slightly lower offer for a guaranteed sale.

• Swift Settlement: Highlight your ability to settle quickly to sweeten your bid.

How to Structure a Pre-Auction Offer

• Above Guide Price: Generally higher than advertised expectations.

• Minimal Conditions: Fewer contingencies make your offer cleaner.

• Proof of Funds: Attach your pre-approval or deposit evidence to instil confidence.

Negotiation Tactics

Leverage Inspection Findings

Use any issues uncovered—like minor roof leaks or termite damage—as negotiation points. Ask for a price reduction or repair credit.

Counter-Offer Strategies

If your offer is declined, consider:

• Small Price Increase: Meeting midway between your bid and the seller’s counter.

• Reduced Conditions: Waiving non-essential clauses to streamline the sale.

• Alternative Settlement Dates: Proposing dates that better suit the vendor.

Legal Considerations

Cooling-Off Periods by State

Most Australian jurisdictions grant buyers a short window to withdraw after exchange:

• Victoria: 3 business days (forfeit 0.2%).

• Queensland & NSW/ACT: 5 business days (forfeit 0.25%).

• SA: 2 business days (seller keeps up to $100).

• WA & TAS: No standard cooling-off for private sales.

• NT: 4 business days, penalty-free.

Note: Auctions generally have no cooling-off period.

Withdrawing an Offer

• Before Acceptance: You can retract your offer anytime—simply notify the seller or their agent.

• After Acceptance: You’ll need to rely on any cooling-off rights or negotiate formally, which may incur penalties.

Seller Withdrawal Risks

A vendor can only pull out if:

• The contract includes a cooling-off provision and they invoke it.

• The buyer fails to meet agreed terms (e.g., deposit payment). Otherwise, legal action may be required.

From Exchange to Settlement

Exchange Contracts

Once both parties sign:

• The buyer pays the deposit (usually 10%).

• The contract becomes legally binding.

Settlement Day

Coordinate with your lender and conveyancer to ensure:

• Full Payment Transfer

• Title Registration

• Water and Utility Adjustments

Handover Checklist

• Collect keys, garage remotes, and alarm codes.

• Obtain copies of manuals and warranties for appliances.

• Complete a final inspection to confirm agreed repairs or inclusions.

FAQs

How much deposit should I offer? While 10% is common, even a 5% deposit shows commitment. A larger deposit may strengthen your offer.

Can I negotiate after exchange? Post-exchange amendments require mutual agreement and documented contract variations.

What if I can’t settle on time? Communicate early with your lender and the seller. You may negotiate an extension, but expect possible penalties.

By following these guidelines—pre-approval, market research, personalised offers, and clear contract terms—you’ll position yourself as a confident, credible buyer. Whether you’re negotiating a private treaty or bidding before auction day, a strategic approach maximises your chances of securing your dream home at the best price.