Is a verbal offer on a property legally binding in Australia?

No. Verbal offers are not legally binding in any Australian state. They signal your interest and open negotiations, but a contract only becomes binding when both parties sign the written contract of sale.

What deposit do I need to make an offer on a house in Australia?

The standard deposit is 5-10% of the purchase price, held in a trust account until settlement. A 10% deposit signals stronger commitment to the vendor, while some agents accept as little as 0.25% initially during the cooling-off period.

Should I include a subject-to-finance clause in my offer?

Yes, unless you have unconditional finance approval. A subject-to-finance clause typically gives you 14-21 days to obtain formal loan approval. Without it, you are obligated to complete the purchase even if your loan is declined, and could lose your deposit.

Can I withdraw my offer after it has been accepted?

Once both parties have signed the contract, it is legally binding. In most states, there is a cooling-off period (typically 2-5 business days for private treaty sales) during which you can withdraw, but a penalty of 0.25% of the purchase price usually applies. There is no cooling-off period for auction purchases.

How long does the vendor have to respond to my offer?

There is no legal time limit for a vendor to respond to an offer. In practice, agents usually communicate a response within 24-48 hours. You can set an expiry on your offer to create urgency, but the vendor is under no obligation to respond within that timeframe.

Can I make an offer on multiple properties at the same time?

You can make verbal offers on multiple properties, but be careful with written offers. Once you sign a contract and the vendor countersigns, you are legally bound. If two vendors accept simultaneously, you could be committed to purchasing both properties.

How to Make an Offer on a Property in Australia: A Complete Guide | Realestate Lens

Making an offer on a property in Australia is one of the most significant financial decisions you will ever make. Whether you are a first-home buyer or an experienced investor, understanding the process — from your initial verbal expression of interest through to a binding contract — can save you thousands of dollars and help you avoid costly mistakes. This guide explains every step of making an offer on a house or apartment in Australia, including how to negotiate, what conditions to include, and what happens once your offer is accepted.

Definition

Property offer

A formal proposal to purchase a property at a specified price and under specified conditions. In Australia, a verbal offer is not legally binding, but a signed contract of sale becomes binding once countersigned by the vendor.

Verbal Offers vs Written Offers

In Australia, the offer process typically begins with a verbal offer communicated through the selling agent. Verbal offers are not legally binding — they simply signal your interest and open the door to negotiations. The agent will present your offer to the vendor (seller), who can accept, reject, or counter-offer.

A written offer carries more weight. It shows the vendor you are serious and committed. In most states, a written offer is made by completing the contract of sale with your proposed price and conditions, then signing it and presenting it to the vendor. Once the vendor countersigns, you have a binding contract — so it is critical you understand what you are signing before you put pen to paper. Use tools like AI contract analysis to review the contract before submitting your offer.

What to Include in a Written Offer

Your written offer — usually the contract of sale itself — should include:

Written Offer Essentials

The purchase price — your proposed price for the property
Deposit amount — typically 5-10% of the purchase price, held in trust until settlement
Settlement period — the timeframe between exchange and settlement (commonly 30-42 days, but negotiable)
Conditions (subject-to clauses) — any conditions that must be met, such as finance approval, building and pest inspections, or sale of your existing property
Inclusions and exclusions — items that are or are not included in the sale (e.g., curtains, appliances, garden sheds)
Your full legal name and details as the purchaser on the contract

Before signing any contract, have it reviewed by your solicitor or conveyancer. Our guide to reading property contracts walks you through every section you need to understand.

Conditional vs Unconditional Offers

One of the most important decisions you will make is whether to submit a conditional or unconditional offer.

Conditional Offers

A conditional offer includes one or more "subject-to" clauses. If the conditions are not met within the specified timeframe, the buyer can withdraw without penalty. Common conditions include:

Subject to finance: The contract is conditional on the buyer obtaining formal loan approval (typically within 14-21 days)
Subject to building and pest inspection: The buyer can withdraw if the inspection reveals significant defects
Subject to satisfactory strata report: For apartments and units, this lets you review the body corporate records before committing
Subject to sale of existing property: The contract depends on the buyer selling their current home first

Conditional offers provide a safety net but are less attractive to vendors, especially in competitive markets where other buyers may be offering unconditionally.

Unconditional Offers

An unconditional offer has no subject-to clauses. Once signed by both parties, the contract is binding. This is riskier for the buyer — if your finance falls through or the building inspection reveals serious problems, you may still be obligated to complete the purchase or face losing your deposit.

Only make an unconditional offer if you have unconditional finance approval (not just pre-approval), have already completed all inspections, and have had the contract thoroughly reviewed.

Risk of Unconditional Offers

Never make an unconditional offer unless you have unconditional finance approval, completed inspections, and professional contract review. If your finance falls through after signing unconditionally, you could lose your deposit and face a damages claim from the vendor.

How Much Below the Asking Price Should You Offer?

There is no universal rule for how far below the asking price you should offer — it depends entirely on the market conditions, the property's time on market, the vendor's motivation, and comparable sales in the area. Here are some general guidelines:

Hot market (high demand, low supply): Properties often sell at or above the asking price. Offering significantly below asking may see your offer rejected outright.
Balanced market: Offers 3-5% below asking price are common starting points for negotiation.
Slow market (low demand, high supply): You may have more room to negotiate. Offers 5-10% below asking price are not unusual, particularly if the property has been listed for a long time.
Days on market: A property that has been listed for 60+ days suggests the vendor may be more flexible on price.

Always base your offer on comparable sales data, not just the listed price. Your agent or a property research tool like Realestate Lens Property Research can help you understand what similar properties have recently sold for in the area.

Offer Strategy Tip

Use specific numbers in your offer (e.g., $687,500 instead of $690,000). Specific figures signal to the vendor that you have done your research and calculated a precise value, rather than rounding to a convenient number.

The Negotiation Process

Property negotiation in Australia typically follows this pattern:

1
Submit your initial offer
Submit your offer (verbal or written) through the selling agent. Base it on comparable sales data and start below your maximum.
2
Receive the vendor's response
The vendor accepts, rejects, or makes a counter-offer. The agent will communicate the response and may share information about the vendor's position.
3
Exchange counter-offers
You and the vendor go back and forth, adjusting the price, conditions, or settlement terms until you reach agreement or walk away.
4
Reach agreement and sign the contract
Once both parties agree on price and terms, the contract is signed by both parties and becomes legally binding.

Remember that the selling agent works for the vendor, not for you. Be polite but strategic. Do not reveal your maximum budget, and do not be pressured into making a rushed decision. It is perfectly acceptable to take 24-48 hours to consider a counter-offer.

Tips for Making a Strong Offer

Strong Offer Checklist

Get your finance pre-approved — a pre-approval letter shows the vendor you are a serious buyer with financial capacity
Complete inspections early — removing the building and pest condition makes your offer more attractive
Be flexible on settlement — offering a settlement date that suits the vendor can tip the balance in your favour
Respond quickly — in competitive markets, speed matters. Have your conveyancer on standby
Make your offer clean — fewer conditions make it more attractive, but never sacrifice protections against genuine risk
Offer a larger deposit — a 10% deposit shows stronger commitment than the minimum 5%

Offer Accepted: What Happens Next

Once the vendor accepts your offer and both parties sign the contract of sale, the contract is "exchanged." From this point:

1
Pay the deposit
Pay the agreed deposit, usually held in the agent's or solicitor's trust account.
2
Cooling-off period begins
The cooling-off period begins if applicable — it does not apply to auction purchases.
3
Conveyancing starts
Your conveyancer begins the legal process: conducting searches, reviewing the title, and preparing for settlement.
4
Satisfy conditions
If your offer was conditional, the clock starts on your subject-to clauses (e.g., 14 days for finance approval).
5
Contract becomes unconditional
Once all conditions are satisfied, the contract becomes unconditional and both parties are fully committed.
6
Settlement proceeds
The settlement process proceeds toward completion on the agreed date.

Learn more about the cooling-off period and the settlement process.

Making Offers at Auction

The process is entirely different at auction. There is no written offer stage — you bid publicly against other buyers, and the highest bid above the reserve price wins. The contract is signed on the spot with no cooling-off period and no conditions. You must have your finance, inspections, and contract review completed before auction day. Read our comprehensive guide to buying at auction for full details.

Making an offer on a property is a structured process, not a handshake deal. Take the time to research comparable sales, get your finance in order, have the contract reviewed by a professional, and negotiate strategically. A well-prepared buyer who understands the process will always be in a stronger position than one who rushes in unprepared. Use every tool at your disposal — including AI-powered contract analysis — to make sure you know exactly what you are committing to before you sign.

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Frequently Asked Questions

Disclaimer: This article provides general information only and does not constitute legal or financial advice. Always consult a qualified solicitor, conveyancer, or financial adviser before making property purchase decisions.

How to Make an Offer on a Property in Australia: A Complete Guide