Agent asking me to sign a contract as a form of an offer

I've had quite a few agents who refused to communicate to the vendor a written offer to purchase their property (which I send by email), particularly in QLD and WA, where they ask me to sign a contract of sale as a way of making an offer.
To me it seems unreasonable, because if you wanted to make offers on multiple properties, you can't possibly sign all contracts and be legally bound by them all if they were all accepted, hypothetically speaking.
What are your thoughts on this process? What's the best way to put an offer?

 

This is how it's commonly done. If you're making multiple offers and one is accepted, you quickly contact the others and recind those offers.

 

An emailed offer is only a "maybe I will be buy" and has no contractual standing. If you have the Owners contact details, by all means email them directly to get their thoughts on your offer, but it won't be binding until it is on the O&A document and signed by both parties.

I agree that no REA will pass on an emailed offer to their vendor in WA.

If you are serious about buying, use the O&A document used in WA, but include a time clause for acceptance.

 

Hmm..What if you put offers on 3 properties at once, and they all come back with the vendor's signature?

 

This is how it works in Qld - an offer isn’t an offer unless it’s a signed contract. If you put offers on multiple properties then you need to be prepared to buy multiple properties… perhaps put an expiry clause on the contract so the seller has, for example, 24 hrs to accept or reject the offer.

 

Then you are buying 3 properties

 

Yeah it’s tricky. Either you expect them to verbally accept your offer, then proceed or if they insist price on contract, you better tell them you’re bidding for multiple properties.

 

You monitor your offers and make sure they don't all come back at the same time. As soon as you get one offer accepted, you cancel the others.

I don't recall the specifics for WA, but in Victoria you also get a 3 business day cooling off period where you can exit a contract for any reason you like.

 

And yet I have never put in an offer like that and own a couple of properties in QLD. We just put in our offer in writing, and then some haggling with the vendor often happens. And after it's all agreed (price and terms and conditions) then the contract is drawn up by the lawyers, and signed and exchanged. There are 'always' changes made to the contracts during this process before signatures. And I won't sign something that I am not 100% in agreeance to the terms on. The last contract we done, in QLD, had a number of different little alterations and specifications made to it (by us and the vendors) before we were happy to sign / exchange.

Same way we have done it in other states too.

Its never been an issue for us. I am guessing because the real estate agents have all known that we were very serious buyers?? I cannot think why else they would be demanding people sign a contract for an offer, except to try and weed out those wasting their time.

If they wanted me signing a contract as an offer, they would need to first be communicating with the buyer about the specific terms of the contract that I am willing to agree to. In which case, my offer must be communicated to the vendor first anyway, in order for any changes to be made.

I have never not changed a contract in some way shape or form.

 

Me too. The contract has kicked off the negotiations (price, settlement period etc) and it ends up going back and forth a few times (sometimes with a discussion to speed things up once we both know the other party is serious). I don’t understand how someone could do it without a contract unless it was a very slow market. The vendor will keep looking for other offers otherwise as there has been no commitment by potential purchasers.

 

I think we’ve had verbal offers accepted in q’land , but it’s not confirmed until it’s signed .

most times we signed a contract as an offer .

If the markets hot ( ie now ) they’re not going to take it seriously unless you’ve signed a contract.

NSW . We’ve always made a verbal offer and had it accepted prior to signing . A couple of times , this has lead to a rush to sign ASAP , including misinformation by us as when we can get into sign it …

cliff

 

As with Rugrat, I've managed to finalise our verbal negotiations in the form of a written email offer in QLD, and once the vendor has accepted my offer, we proceeded to signing and exchanging contracts. Having said that, the pressure from many agents was to straight up sign the contract right after the inspection on a Saturday - they know very well that you can't get legal advice until Monday.
I have very little experience with WA, but their REI form itself is titled "Contract for sale of land or strata title by offer and acceptance".

 

It's definitely the done thing in WA to put your offer on a contract. You can chat to the REA about various aspects like "do you think $700k will be accepted" but they won't take it seriously until you put pen to paper on a REIWA contract

Note there is no cooling off in WA so be very careful about making multiple offers

 

You have raised a number of interesting points with regard to making an offer. In QLD, unless the offer is on a standard contract it just a piece of paper with a price on it. The agent should by law pass all offers onto the seller but unless it is on a standard contract it could be argued that it is not really an offer. When I make an offer to buy property I insist that the agent puts it on a contract which I will sign, I then also add a clause that says that if the contact is not signed by the seller within 7 days the contract is not valid. This focuses the sellers mind. Also, consider that if you sign a contract without a sunset clause and you do not withdraw it then the agent can use this as a tool to encourage higher offers. If they don't materialise the seller can then sign the contract and you are then legally committed. Many years ago I heard about this happening to a buyer. About a year after putting in his offer and after he had bought another property, the seller signed the contact after the agent didn't manage to achieve a higher price. The buyer just thought the contract had not been accepted and moved on. I believe it went to court and the buyer was forced to pay the 10% deposit which he then lost.

 

I've had the opposite problem. An offer on a contract is binding, and it's my preference. An agent can tell you an email offer is accepted, while they try to find someone else to make a counter offer...

 

Just had a similar experience in QLD. Submitted an offer on a contract and was told verbally late last night it had been accepted. Chased it up today, being told it was on its way shortly, just waiting on the owner to sign it.

Finally get the dreaded call this afternoon, RE had continued negotiating with a late appearing buyer and accepted 20k higher offer. Not much more I could of done in a hot market I suppose.

 

Its a area of contract law and very normal. The agent and vendor want a committed offer not a mere offer to make a contract. Sounds like you havent asked a solicitor to advise you on the nature of the contacts. They would make that point very clear.

Yes you can be legally bound by each contract you sign. But your solicitor may advise you on the lack of consideration may render the contract unenforceable. The offer you make may need to be conditional on acceptance within a specificed period also for example. That way they cant sit on the offer and affect you making offers elsewhere.

 

What's the best strategy to make multiple offers safely in today's hot market in Perth ? I put an offer on one already, so what if I want to offer on others in the mean time?