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There is a lot to think about when it comes to making an offer on a property. The conditions related to the offer are often the most important factors, but many buyers tend to overlook these finer details in the pressure of the moment.


There is a lot to think about when it comes to making an offer on a property. The conditions related to the offer are often the most important factors, but many buyers tend to overlook these finer details in the pressure of the moment.

When negotiating with the seller, you will have the opportunity to make the offer subject to various conditions. Some conditions may include subject to finance, subject to pest and/or building inspection or even repairs to the property. But remember, offers and conditions need to be kept as simple as possible for the vendor, if they are too complicated, vendors could reject your offer and you could miss out on the property.

So what are the common conditions you need to be aware of before making an offer?

Unconditional offer

An unconditional offer is when a buyer does not place any conditions on their offer. This is often preferred by sellers as it is an easier option and the sale can be proceed quickly.

While an unconditional offer may put you ahead of the rest of the buyers, if your offer is accepted and you exchange contracts you are usually only given a short amount of time to change your mind. The cooling off period once you exchange contracts is usually five days. Some buyers exchange quickly to get the property off the market, intending to get all the checks and balances done before the cooling off period expires. Pest and building inspections, full finance approval and getting your solicitor to check the contract, are a lot to get done in just 5 days, particularly finance approval.

If your approval is not finalized in the 5 days you left with two options - pull out of the purchase or go ahead and risk finance approval not coming through. This can be a very stressful situation to be in.

Subject to finance

The subject to finance condition is there to protect you as a buyer. It can allow you to pull out of the purchase if your loan is not approved and allows you to end the contract without penalty.

A 'subject to finance' can help ease the stress of purchasing a property, but it is important that the wording of the condition is 100% correct. It is best to get your solicitor or conveyancer involved to assist you with the wording of the finance clause. They will have the knowledge and experience to create the clause you want and also negotiate with the vendor's solicitor if need be.

Subject to pest inspection

Just because you do not see any bugs or pests around the property when you walk through, it doesn't mean they are not there. A pest inspection will check to see whether there are any termites or other problems. Termites can cause a great deal of structural damage to a building. They can eat through structural timbers, under floors and even in the roof cavity. This can cause great problems for you down the track if you buy the property as you will be responsible for paying for the extermination or if you don't have them exterminated, you may have trouble selling the house.

Subject to building inspection

If you are looking at an older property, you may want to make your offer subject to a building inspection. This is when a professional will come in and inspect the integrity of the building. You will receive a structural report on the property, assessing whether it is sound or not. Both the pest and building inspections can be carried out during the cooling off period.

What’s the most important thing before making an offer?

It is extremely important to have finance pre-approval before making an offer on a property. Often real estate agents will ask if you have pre approval to demonstrate to vendors that you are a serious buyer. Formal pre approval will also allow you to move ahead quickly once your offer is accepted as a lot of the paperwork has been completed.

To get a quick indication of whether the property you are looking at is affordable try the State Custodians instant online pre-approval. It only takes a few minutes and gives you an instant result on-screen and an email confirmation of the details - perfect for when you’re out and about.

Formal pre approval will require you to fill in a full application and provide documents like payslips and bank statements. Once you are have formal pre approval it is also a good idea to keep in close contact with your lender while you are looking for a property. By keeping them up to date on your plans, they will be able to move quickly when you do make an offer as all the paperwork will be ready to go.

At State Custodians, we understand how important it is to move quickly in the property market and aim to make the home loan process as easy as possible so that you can focus on finding your dream property. To discuss your lending options, give our Lending Specialists a call today on 13 72 62 or leave your details here and they will contact you.