From Auctions to Private Sales: Understanding Melbourne’s Property Sales Process

Melbourne, the vibrant cultural capital of Australia, boasts a diverse real estate market. Whether you’re a prospective buyer or seller, understanding the different methods of property sales is crucial. In this blog, we delve into the nuances of Melbourne’s property sales process, exploring auctions, private sales, and more.

1. Auctions: The Thrill of Competitive Bidding

Auction sales are enthusiastically embraced in Melbourne. Here’s why:

Exhilarating Atmosphere: Picture a room filled with eager buyers, adrenaline pumping, and auctioneers skillfully wielding their gavels. Auctions create a lively and competitive environment.
Binding Sale: Unlike other methods, auctions result in a complete and binding sale without a cooling-off period. The highest bidder secures the property immediately.

2. Expression of Interest (EOI): Tailored Offers

EOI invites buyers to submit their best and final offers. Key points:

Customized Offers: Buyers can tailor their offers to align with their preferences regarding price, deposit amount, settlement time, and additional terms.
Mutually Beneficial Transactions: Sellers evaluate offers and select the most favorable one, ensuring a tailored and mutually beneficial transaction.

3. Private Sales: Flexibility and Control

Also known as sale by negotiation, private sales offer homeowners greater flexibility:

Set Price: The property is advertised with a set price, acting as the vendor’s reserve. Interested buyers negotiate directly with the selling agent.
Personalized Negotiations: All negotiations are handled by the agent, considering specific buyer requirements and accommodating mutually beneficial agreements.

4. Off-Market Sales: Discreet and Exclusive

For those seeking discretion, off-market sales provide an attractive option:

Exclusive Approach: These properties are not publicly advertised. Instead, agents rely on their networks and databases to connect with pre-qualified buyers actively seeking properties.
Cost-Effective: By avoiding public exposure, homeowners can sell discreetly while minimizing advertising expenses.

Navigating Melbourne’s real estate market involves understanding these sales methods. Whether you’re drawn to the excitement of auctions, the flexibility of private sales, or the exclusivity of off-market deals, make informed decisions to achieve success in this competitive landscape.

Let’s explore the advantages of using a private sale platform for selling your property in Melbourne:

Cost Savings: Opting for a private sale platform can significantly reduce costs compared to traditional real estate agents. You avoid hefty commissions and marketing fees, allowing you to retain more of the sale price.
Control and Flexibility: As a seller, you have direct control over the entire process. You set the price, negotiate with potential buyers, and decide on terms. This flexibility enables personalized negotiations tailored to your needs.
Privacy: Private sales maintain your privacy. Unlike public auctions, where your property is on display, private sales allow discreet marketing. You choose who views your property, minimizing intrusion.
Targeted Marketing: Private sale platforms often attract serious buyers actively seeking properties. Your listing reaches a targeted audience, increasing the chances of finding the right buyer quickly.
No Time Pressure: Without auction deadlines, you can take your time to evaluate offers and make informed decisions. There’s no rush to finalize the sale, allowing for thoughtful negotiations.
Transparent Communication: Direct communication with potential buyers fosters transparency. You can address their queries promptly and build trust throughout the process.

Remember, private sales empower you as a seller, providing control, cost savings, and a personalized experience. Consider leveraging these advantages when navigating Melbourne’s real estate market.

When selling your property privately in Melbourne, it’s essential to be aware of the legal requirements. Here are some key considerations:

Contract of Sale:
- The Contract of Sale is a legally binding agreement between the seller and the buyer. It outlines terms and conditions such as the purchase price, special conditions, settlement date, and other relevant details.
- Engage a qualified conveyancer or solicitor to draft the Contract of Sale. They ensure compliance with state-specific laws and protect your interests.
- In New South Wales (NSW) and Australian Capital Territory (ACT), you must have a sale contract before listing your property online^Ad ¹.
Vendor Statement (Section 32):
- You need to provide a vendor statement (also known as Section 32) to potential buyers. The content varies by state or territory:
  - New South Wales (NSW): Includes title details, zoning information, encumbrances, tenancy details, and more.
  - Victoria (VIC): Covers title details, zoning, covenants, rates, and structural defects.
  - Queensland (QLD): Includes title details, easements, zoning, rates, and land contamination.
  - South Australia (SA): Contains title details and encumbrances^Ad ¹ ² ³.
Cooling-Off Period:
- In a private sale, prospective buyers have three business days to reconsider their decision (cooling-off period) for residential properties and rural properties less than 20 hectares.
- Underquoting (advertising at a price lower than estimated or rejected prices) should be avoided ².
Due Diligence Checklist:
- Sellers or estate agents must provide a due diligence checklist to prospective buyers during open inspections.
- The checklist helps buyers identify issues related to owners’ corporations, flood/fire risks, insurance coverage for renovations, and more ².
Making an Offer:
- If an agent manages the sale, make your offer through them. Otherwise, negotiate directly with the seller.
- You can include conditions (e.g., subject to finance, building inspection) in the contract.
- Consider whether to make your best offer upfront or negotiate from a lower price ².