Buyers and sellers often ask what’s the difference between a property being Under Offer and Sold?
In Western Australia it all comes down to conditions.
A property is Under Offer when a seller accepts an offer on their property that is subject to conditions, such as the buyer receiving finance approval. Normally when a property is Under Offer no further offers can be made or accepted. If however a condition of the contract isn’t met, such as the buyers finance being declined, the contract comes to an end, the property is no longer Under Offer and it’s able to be re-advertised by the selling agent. This is often what’s happened when you see a property advertised as “second chance”.
A property is considered Sold once all of the conditions of the offer have been met and the sale becomes unconditional.
If a property is sold without conditions, so for cash rather than subject to finance, and with no building or termite inspections etc. it’s what we refer to as a “Cash Unconditional” contract. The property is considered to be Sold as soon as the unconditional offer is accepted. The majority of properties sold via Auction are cash unconditional sales.
Confusion arises because agents typically leave properties that are Under Offer and Sold online until after settlement takes place. Settlement is when the ownership, or title, gets transferred from the seller to the buyer. We do that so that buyers can continue to make enquiries about a property until such time as it successfully settles and so that other potential sellers can see what’s happening in their local suburb.
If you see a property that’s Under Offer that’s of interest to you, it’s worth contacting the agent to register your interest in case the sale doesn’t proceed for some reason. They may also have something similar that hasn’t yet hit the market.
There is one exception to the Under Offer rule and that’s when a sellers has accepted an offer that is Subject to Sale with a Two Business Day condition. Normally these properties will not show as Under Offer online.
Properties that are under offer subject to sale are usually still able to be marketed by the sellers who are able to consider further subject to finance or cash offers, but not another subject to sale offer, from other buyers.
If the seller receives another cash or subject to finance offer they wish to accept, they serve a two business day notice to their first subject to sale buyer who then has two business days to remove their subject to sale condition. If the first buyer can’t remove their subject to sale condition the contract comes to an end and the property goes Under Offer to the new buyer. If however the original buyer is able to remove their subject to sale condition, the property will either go Under Offer or be Sold to that buyer, depending upon the contract terms and conditions.
If you’re ever in doubt about the status of a property, simply contact the agent – it only costs you a phone call or email.
Happy home hunting.
Natalie Hoye is the Founder and Licensee of Red Fox Property Group – a boutique agency doing things differently in the suburbs surrounding Beaufort Street. We call it ‘real estate alchemy’: a genuine blend of science and intuition, marketing and magic, head and heart. The Red Fox Way. And we’d love to chat with you about your local real estate needs. Call us now on 0405 812 273.
