24th October, 2024

When it comes to selling property, a common method in Australia is the private treaty sale. In this blog below, we’ll explore what a private treaty sale is, its benefits, and the specific rules that apply in NSW.

What is a Private Treaty Sale?

A private treaty sale is a common method for residential property transactions. In this process, the vendor sets the price they wish to achieve for their property. Then, the real estate agent negotiates with potential purchasers to secure a sale close to this price. Both the vendor and the purchaser can negotiate terms until they reach mutually agreeable conditions.

How Does the Private Treaty Sale Process Work?

1. Price Setting: First, the vendor determines a price range when listing the property for sale.

2. Marketing: Next, the property is marketed, which may include staging for photos, advertising on real estate websites, and hosting open houses for potential purchasers.

3. Offers and Negotiation: Prospective purchasers can make offers through the agent or directly to the vendor. They negotiate on the price and terms, often requesting subject-to-finance clauses or building inspection contingencies. Furthermore, vendors can consider multiple offers and keep the property on the market as long as they wish.

4. Contract Signing: Once a price is accepted, both parties draft, sign, and exchange a contract of sale. Typically, a deposit is required, and the cooling-off period begins.

5. Cooling-Off Period: For private treaty sales in NSW, this period typically lasts for five business days. During this time, purchasers can withdraw from the contract for any reason, although a small fee may apply if they do.

6. Final Inspection and Settlement: Prior to settlement, purchasers usually conduct a final inspection to ensure everything aligns with the contract.

Auction vs. Private Treaty Sale

While auctions can attract high interest and potentially yield the best price, they often come with pressures and costs. For instance, expensive advertising campaigns and public exposure are common drawbacks. In contrast, private treaty sales provide more flexibility and confidentiality, allowing vendors to negotiate terms that suit their situation. Whether they need a quick sale or want to secure the best price, this method offers the necessary adaptability.

Tips for Purchasing a Property via Private Treaty Sale

1. Negotiate Wisely: Use the asking price as a guideline. Consider offering less than you’re prepared to pay to initiate negotiations effectively.

2. Do Your Research: Understand the market by looking at recent sales of similar properties.

3. Set Clear Terms: When making an offer, include any conditions, such as financing or repairs. Documenting these clearly helps avoid issues later.

4. Stay Objective: Keep your emotions in check during negotiations. This approach enables you to secure a fair price and avoid overextending your budget.

5. Conduct Due Diligence: Thoroughly research the property and area. Furthermore, always consider obtaining building and pest inspections to ensure you’re making a sound investment.

Private treaty sales represent the most common way property is sold in Australia. They offer a flexible and less stressful alternative to auctions, allowing both purchasers and vendors to navigate the process at their own pace.

If you’re considering selling your property or have questions about the private treaty process, our team is here to assist you every step of the way! Call Bangalow Conveyancing today on 66870548 to start your property journey.