No Conditions allowed for 5 days if passed in?

[Bandita]

Hi all,

Heard what sounded like a strange one today. My friend is looking at a property (VIC) that was passed in at Auction over the weekend. She wants to put in an offer, subject to finance, but the agent said she can't put anything in until Thurs because it was passed in, you can't have Conditions on your contract?

Sounds like BS to me?? Anyone know?

Cheers
Jen

 

[rugrat]

I thought it was only for the period 'prior' to the auction?? not after???

 

[urban cowboy]

dunno about the thursday thing...

ut the conditions may just be that the owners want an unconditional contract - same as auction conditions.

just a guess, but I have had vendors in the past that are only interested in unconditional offers - some were because the property was a bit dodgy, but others were genuine and just wanted the property sale locked in etc.

 

[Bandita]

yeah, that's what I thought - but friend is saying Agent said no offers are allowed until 3 full business days after property passed in (i.e. Thurs morning). I'd understand if the owner doesn't want to accept an offer with no conditions - but that still doesn't mean you can't put your offer in, right?? He won't even let her put the offer in writing.

I think the agent is playing her to see what offers he can get by Thursday - but maybe there's new laws out there or ones I've never known about??

Anyone seen this before?

Cheers,
Jen

 

[JIT]

JenD, I had the same situation late last yr, agent said 3 days post-auction before a conditional offer, not sure where they got it from, but I made a verbal conditional offer and waited 3 days to put it in writing, and it was accepted. Hadn't heard of this before though.

 

[The Y-man]

I think the agent is playing her to see what offers he can get by Thursday - but maybe there's new laws out there or ones I've never known about??

I am not sure whether it is law (I can't find any info for conditions - but this is certainly the case for cooling off periods - i.e. definitely NO cooling off within 3 Biz Days either side of an auction), but I know for auctions we have been to / and have sold at, the contracts have contained similar conditions.

The only thing I can find is:
http://www.lawyersconveyancing.com.au/auctions.asp#11

Changing the conditions in an auction contract
Everyone knows that auctions are held at times and places where it is impossible to get legal advice or legal assistance.

It is also well known that the estate agent is the only person at the auction who knows enough about the law of real estate to be able to win an argument. At the auction the estate agent is king, simply because no-one knows what to say when the agent refuses to allow the addition or deletion of any conditions in the contract.

However, there is a way to ensure that you are protected when you attend at an auction as a Purchaser. Obtain a full copy of the Contract before the auction, and have a qualified lawyer check it out. Have any nasty conditions deleted, and add any protective conditions your lawyer suggests.

Before the auction, hand a photocopy of the amended Contract to the auctioneer or any of the other estate agents at the property (be sure to record the name of the person you hand it to, and be sure to keep the original in your safe custody). Tell the auctioneer or estate agent that you will be bidding, but you will be bidding on the basis that YOUR contract is the one to be signed.

Don't listen to the agent's protests (the person you want to impress is the vendor). If the property is knocked down to you the agent may say that you have to sign the original unaltered Contract, but you will know that this is false. You are entitled to demand that your Contract be the one that is signed if the Vendor wants a sale. It will then be up to the Vendor (not the agent) as to whether or not your offer will be accepted on your terms. If you have made a good offer, and the Vendor is keen to accept your price, it will be your Contract that will be signed - on your terms.


Cheers,

The Y-man

 

[Bandita]

I am not sure whether it is law, but I know for auctions we have been to / and have sold at, the contracts have contained similar conditions.

Thanks so much - very interesting, it sounds like this might be standard conditions of a contract - if so, all good

This part is interesting though - makes it seem like conditions are OK?

The only thing I can find is:
http://www.lawyersconveyancing.com.au/auctions.asp#11

. If you have made a good offer, and the Vendor is keen to accept your price, it will be your Contract that will be signed - on your terms.

That to me says you CAN make offers with conditions? Before auction, I 100% get it - after auction, and the property has been passed on - seems stange there would be legalities on the conditions you might offer to purchase the property? But maybe I'm missing something??

Thanks so much for your help!!

Cheers,
Jen

 

[Jonathon]

There's a huge difference between a cooling-off period and a conditional contract.

Cooling-off period means you can change your mind, for no reason other than you simply don't want to buy any more...although there's the fee which is a %age of the purchase price. It applies 3 business days before and after a public auction in Victoria, hence Thursday morning.

A condition means that the condition has to hold true (or false) for the sale to be cancelled, with no recourse to the potential purchaser. As others have pointed out in this thread, it is possible to place conditions on an auction in Victoria, although if the agent knows there are several real bidders then they're unlikely to accept the conditions, expecially in a booming market.

Right now you'd probably get away with placing conditions on a bid for a $4m house in Toorak, but you'd have absolutely no chance on a $650k house in Northcote, where there'll be 6+ potential buyers bidding unconditionally.

It's not too unusual to hear the auctioneer at a Victorian auction to announce, after he's run through the usual spiel, that several bidders have agreed alternative terms before the auction and that those alternative terms will be agreed in the event they buy the property, although they're probably just changes to the settlement date.

Cheers
Jonathon