How a home is bought, a guide by Dotto

An atlas of buying property, state by state

Plate II · Private treaty

Making an offer by private treaty

In a private treaty sale, a buyer makes an offer, the seller weighs it, and neither side is bound until a contract is signed, or in the ACT and the Northern Territory, exchanged. The broad route looks alike in every state charted here; what changes is how the offer must be made, how fast it reaches the seller, and the exact moment it becomes a contract.

Charted on this plate VIC QLD SA WA TAS ACT NT

The route an offer travels

Seven stations, from first figure to binding contract. At each one, the states that speak to it are named, in their own terms.

  1. The offer goes to the agent, or to the seller

    • VIC If an agent is managing the sale, the offer is made through the agent, usually by signing the contract of sale, and the agent takes it to the seller unless the seller has told them not to. With no agent, the offer goes to the seller.
    • QLD The seller’s agent can say how offers are made. Usually it is a verbal offer, a form stating a written offer, or the offer written into a contract of sale the agent provides.
    • WA Through an agent, offers are submitted to the agent in most cases, on an Offer and Acceptance form (the O&A). With no agent, the offer and its terms are negotiated with the seller directly.
    • ACT Through the selling agent, or directly to the seller in a private sale.
    • NT Where the seller has an agent, the offer must be made to the agent, who usually prepares the written offer with a contract of sale.

  2. In writing, or not

    • SA Each offer must be in writing and signed by the potential buyer.
    • VIC Offers made out loud can be part of the negotiation; a binding contract of sale can only come from an offer in writing.
    • NT The Northern Territory Government recommends putting the amount in writing, such as an email.

  3. The offer reaches the seller

    • SA The agent must tell the seller about an offer within 48 hours. Buyers aren’t told about other offers, and the seller can accept a higher one without giving others the chance to negotiate.
    • WA The agent must communicate all written offers to the seller, who is free to accept or decline any of them, whatever the order they arrived in.
    • ACT Until contracts are exchanged, the law obliges the agent to pass every offer on to the seller.
    • NT Agents have to pass on all offers to the seller; their duty is to the seller, not the buyer.

  4. Conditions travel with the offer

    • VIC A private sale can be made subject to conditions such as loan approval, the sale of an existing property or a building or pest inspection. Consumer Affairs Victoria says a contract subject to finance should always nominate a lender.
    • QLD Conditions such as finance, building and pest inspections, or selling an existing property must be in the contract when it is signed, or they won’t be legally binding.
    • WA Conditions can include finance, the sale of an existing property, inspections or the seller fixing something broken. WA also describes the “as is” offer, where the seller won’t agree to special conditions such as building and pest inspections.
    • NT The Northern Territory Government says a condition should set out what has to happen, who has to do it, when and to what standard, what happens on default, and whether it may be waived and by whom.
    • TAS The standard form contract used for most Tasmanian sales has limited “get out” clauses; the most common are finance and building inspection conditions.

  5. Counter-offers

    • WA A seller can counter by amending the O&A. For any change to bind, both parties must initial and date it and sign and date the document in full. It isn’t a binding contract until every term is agreed.
    • NT On receiving an offer, the owner can sign the contract at that price, reject it, or change the price for the buyer to consider.
    • VIC If an offer isn’t accepted, the agent may ask whether the buyer will go higher, and negotiates between the parties to get the highest price for the seller.

  6. A date for the offer to lapse

    Three regulators make the same recommendation: write in a date by which the offer lapses, so the buyer knows where they stand on that day. Victoria, the ACT and the Northern Territory each say so.

  7. The moment it binds

    • VIC The property is sold when both buyer and seller have signed the contract of sale.
    • QLD The contract becomes binding only when both buyer and seller have signed it.
    • SA Once a contract is signed by the buyer and the seller, it is legally binding.
    • WA When the seller signs the O&A, it becomes a binding contract of sale, and each party must get a signed copy.
    • ACT An offer isn’t legally binding until contracts are exchanged: a contract signed by the buyer handed over for one signed by the seller.
    • NT The contract isn’t binding until the copies are exchanged.

Between offer and contract: gazumping

Gazumping is the gap in this route. In the Northern Territory Government’s description, a seller says yes to one buyer’s price out loud, then signs with someone else who pays more. Because no contract was ever signed with the first buyer, it breaks no law. Whatever the first buyer has already spent on legal advice, inspection reports or a finance application stays spent, though any deposit comes back in full.

The ACT’s guide gives the same picture: a buyer can be gazumped until contracts are exchanged. In the Northern Territory, paying a deposit does not secure the sale.

When the seller keeps listening

Western Australia has a precise rule for one common case: a contract on the standard REIWA conditions that depends on the buyer first selling their own home. Here the seller may keep weighing other offers. Before taking a new one, the seller has to tell the first buyer, and the first buyer gets 48 hours. A first buyer who drops the condition in that time keeps the contract and the new offer falls away; one who doesn’t loses the contract.

In Victoria, a property under offer stays on the market: other buyers can still inspect and make offers until buyer and seller agree on a price and sign a contract.