AN Offer and Acceptance or Contract of Sale is a very important and, when executed correctly, legally binding document utilised in most property transactions across WA.
The Offer and Acceptance is generally completed by the person wishing to purchase the said property with the assistance of a Licensed Real Estate Agent. This constitutes the offer section of the contract. Once the potential purchaser has input their details, the property details, the price they wish to purchase the property for and details of any conditions to the contract and will then sign the offer. The Real Estate Agent will then present the offer to the seller who can accept, decline or negotiate on that Offer.
Once a purchase price and all conditions have been agreed to by both parties the seller will sign to indicate their acceptance of the offer at which point, if executed correctly, the Contract will be legally binding to both parties.
+ Things to think about +
Deposit – the agreed deposit amount must be paid in the timeframe specified on the contract to ensure continuity of the contract.
Conditions – A condition is anything which is required to be completed by either the buyer or seller prior to settlement. Some common conditions are;
- Finance approval – where funds are required from a bank
- Subject to sale – where a property is required to be sold
- White ant report – a report from a reputable pest control company
- Building report – a report from a registered builder stating that the building is structurally sound.
Conditions will depend on the type of property being sold for example an offer for vacant land would not generally require a building report.
It’s important when writing an offer to consider whether there are any other issues which would influence your decision to buy or sell the said property. A buyer for example may wish for car bodies or scrap metal to be removed from a property prior to settlement, however, it may be the sellers intention that they remain. OR a seller may wish to take a chandelier from the living room which was a family heirloom. Contracts generally state that fixed lighting is to remain at the property however exceptions can generally be made where they are agreed to by both parties at the time of writing the offer. To avoid any issues arising later on it is best to express your wishes to the Real Estate Agent at the time of writing or signing the contract to ensure that these are included in the Offer and Acceptance document and agreed to by all parties.
Conditions will always have a time for completion. It is important that the conditions be satisfied within this timeframe. If this is not possible it is best to contact the Real Estate Agent to arrange for a variation which will allow more time in which to complete the condition if agreed to by all parties.
If you are ever uncertain about any aspect of an Offer and Acceptance you should always speak to a Real Estate Agent, Settlement Agent or Solicitor prior to signing it.
