A vendor may want to list their property for sale by negotiation when it’s difficult to estimate the market price of their property.
There are different ways of selling a property by negotiation. One is to market it as buyer enquiry over (BEO) or buyer budget over (BBO) a set price or by providing a pricing guide.
The BEO needs to be realistic, and if the vendor rejects offers over the BEO, you may need to re-evaluate the BEO.
Managing the offer process
If a potential buyer makes a written offer, you need to present it to the vendor. You may want to ask any other interested buyers if they would like to make an offer, although the first offer needs to be presented within a reasonable timeframe. It’s important you check the first offer for a sunset clause to avoid placing your vendor or customers under undue pressure.
If there is more than one written offer, it becomes a multi-offer process. More information about selling a property by multi-offer
If there is just one written offer, the vendor can consider the offer and decide what to do:
- Consult their lawyer or conveyancer, sign the sale and purchase agreement and accept the offer.
- Reject the offer. In this case, the buyer may decide to put in another offer. You don’t have to tell the buyer why the vendor rejected the offer, but it may be helpful for them to know so they can make a better offer next time.
- Negotiate the offer. The vendor may decide to make changes to the sale and purchase agreement, which you will need to point out to the buyer. The buyer will need to review the agreement and only sign it if they are happy with it. The vendor and the buyer may go back and forth a few times before they agree on terms they are both happy with.
- The buyer can withdraw their offer at any time before it has been agreed and signed by both parties. A verbal acceptance from a vendor is not binding, and they can still choose to accept an offer from another buyer.
Completing the sale
If the vendor accepts an offer, the buyer and vendor will need to work to meet any conditions included in the sale and purchase agreement. You may need to provide access to the property to help the buyer satisfy their conditions, for example, if the property needs to be inspected by a property inspector.
If the buyer needs more time to satisfy their conditions, the buyer’s lawyer may work with you to arrange this with the vendor. Any changes will need to be signed off on the sale and purchase agreement by both the buyer and vendor.
When all conditions have been met, the lawyer or conveyancer can confirm the sale is unconditional.