Withdrawing an offer

Discussion in 'The Buying & Selling Process' started by D&J, 17th Mar, 2016.

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  1. wylie

    wylie Moderator Staff Member

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    I see things wrong with verbal or email first. That can be seen as tyre kicking, testing the waters, giving the agent information on what you are prepared to offer, which "can" be used by some agents to get another purchaser to go higher. We bought a house once when an agent told us what the other offer was. He hinted that other $10K would buy it so we offered $10K higher, on a signed contract, and had the vendor countersign it before the other purchaser had time to think about whether to go higher. I'm guessing they were likely pretty annoyed that we got in with a signed contract before they could agree to the counter offer.

    This is where a contract is far superior than any old letter of offer, or email. They have no legal standing, whereas a signed contract becomes binding as soon as the vendor signs it (or initials the change if there are counter offers, back and forth).

    My mother used to sell houses and told me many years ago never to tell any agent what your offer will be until you are sitting with a contract in front of you holding a pen. In all the transactions I've been party to (buying and selling) agents want it closed down quickly, unless they are using your offer as leverage. I've only once or twice had to spend a sleepless night wondering if we've bought a house. Most recent overnighter was waiting for a vendor in London with time differences, to sign. We wanted the house off the market before the scheduled open house two days away, and before anyone else pushed for a week day inspection (as I had done). My mother used to drive across Brisbane, sometimes until midnight getting a contract together.
     
    wylie, 19th Mar, 2016
    #21
  2. MyPropertyPro

    MyPropertyPro REBAA Buyer's Agents Sutherland Shire & Surrounds Business Member

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    It doesn't really matter how you make an offer and/or negotiate and arrive at a price provided both parties are open to it. In the end, you can make an offer via email or verbally or on a post-it note and it's not binding until both signatures are on an executed contract. The situation usually dictates the method although sticking to the relevant state's "best practice" will usually be the path of least resistance.

    If an agent is going to use a verbal offer or email offer to go higher, there's nothing stopping them doing that with a contract offer in front of them either. I think the market conditions dictate which method you use more than anything. If it's a soft or slow market and you have a bit more time, verbal or email might suffice. In a market like Sydney over the last two years I'd be going straight to a contract offer. It's horses for courses and I've used all methods quite successfully.

    An agent should never be disclosing what the other offer is anyway and if you stick to a game plan and don't get emotional by letting an agent talk you into upping an offer (because it could be a phantom buyer you're competing with), then you'll only pay what you're prepared to pay and what the property is worth. It's rare for an agent to accept a first offer so not letting them know what you're prepared to offer until you're sitting in front of a contract doesn't really serve any purpose and you'll more than likely have to negotiate further anyway.
     
    Last edited: 19th Mar, 2016
    MyPropertyPro, 19th Mar, 2016
    #22
  3. wylie

    wylie Moderator Staff Member

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    We'll have to agree to disagree on this. I'll never use a verbal offer for all the reasons I've outlined.
     
    wylie, 19th Mar, 2016
    #23
  4. RPI

    RPI SDA Provider, Town Planner, Former Property Lawyer

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    Spot on Offer and Acceptance. The Offer must be communicated.
     
    RPI, 19th Mar, 2016
    #24
  5. D&J

    D&J Well-Known Member

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    Yeah this is exactly what I was thinking ad I was reading both your respective opinions.

    Irrespective of how you communicate the price, the agent can still use an offer on a contract as leverage.

    I'll give an update on my offer later tonight when I have a few more minutes.
     
    D&J, 20th Mar, 2016
    #25
    MyPropertyPro likes this.
  6. wylie

    wylie Moderator Staff Member

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    I guess in all the transactions I've been involved in, buying and selling, the agent goes directly from my dining room to the dining room of the vendor. I've rarely (maybe once) had to wait overnight for an answer, yes or no, or a counter offer. I acknowledge that in a very hot market, there are likely to be several offers on one day, but in usual circumstances this would not be the case, and rarely has it happened in my own experience.

    Many here suggest putting in a time clause for exactly this reason. I've never needed to to do this because the agent has run with my offer and usually says, "I'm going straight to the vendor right now". I've never had to sit for even a night wondering whether my offer is being presented (except for the London time difference in the most recent purchase).

    Agents know that "sleeping on it" can be dangerous for both vendor and purchaser and will try to lock signatures on that contract that very day.

    The few times there have been several offers going in at the same time, I've had an opportunity to put in my best offer, similar to putting in a tender (which I dislike). But I've never had an agent just kind of take their sweet time. They want that second signature as much as I do, especially with no other immediate genuine (prepared to sign a contract) interest.

    Unless an agent has a few people sniffing about, and even with a general enquiry on the property, they would be running with the bit of paper containing a signature, knowing that just one more signature (the vendor's) will ensure the sale is locked in.

    And we go in "cash unconditional" to make it even more compelling to get the vendor's signature (albeit this is watered down somewhat now there are cooling off periods).
     
    Last edited: 20th Mar, 2016
    wylie, 20th Mar, 2016
    #26
  7. MyPropertyPro

    MyPropertyPro REBAA Buyer's Agents Sutherland Shire & Surrounds Business Member

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    I'm in the settlement period of two purchases in Adelaide right now (from the same vendor) and submitted the initial offer on contract. I didn't hear back about the offer for five days! I wasn't desperate to buy, they clearly weren't desperate to sell and we went back and forth counter-signing prices about three times over a two week period before a price was agreed on**. Negotiating over this time frame isn't uncommon in markets that aren't booming. I also bought a couple of properties in California about four years ago and the agent wanted to negotiate verbally before putting anything down on contract i.e the complete opposite.

    In the end it depends on the agent, the vendor, the market conditions, the state or country's best practice and the comfort level and experience of all parties. There is no right and wrong and everyone will have a different method and approach as we've seen here. The important part is not overpaying so whichever way to get there works best is probably the right way for that particular sale!

    Cheers guys,

    Andrew

    **I can highly recommend the App "Notability" to save yourself a lot of printing and scanning in this eventuality.
     
    MyPropertyPro, 20th Mar, 2016
    #27
  8. Mark

    Mark Well-Known Member

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    Is it still possible to withdraw the offer by emailing the agent after the agent emails you to inform you that the contract is accepted but does not email the contract to you?
     
    Mark, 13th Oct, 2017
    #28
  9. Big Daddy

    Big Daddy Well-Known Member

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    No
     
    Big Daddy, 13th Oct, 2017
    #29
  10. wylie

    wylie Moderator Staff Member

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    You should have a cooling off period? You will pay a couple of thousand but that might be more palatable than going through with the purchase if you've changed your mind.
     
    wylie, 13th Oct, 2017
    #30
  11. RPI

    RPI SDA Provider, Town Planner, Former Property Lawyer

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    I can terminate a lot of contracts without penalty. The QLD contract is very buyer friendly.

    B&P and Finance are obvious. But there are also other issues like failing to disclose statutory or unregistered encumbrances.
     
    RPI, 14th Oct, 2017
    #31
  12. Mark

    Mark Well-Known Member

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    Does verbal acceptance of offer is legally binding? Agent advised me on the phone that the offer was accepted but I changed my mind and emailed the agent to withdraw my offer. The seller's conveyancer said that the acceptance of offer was communicated to me via phone already and is legally binding.
     
    Mark, 17th Oct, 2017
    #32
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