The Different Sale Types and Purchase Conditions in Real Estate

  When it comes to buying or selling a property, there are various sale types and conditions that both buyers and sellers should be aware of. Each sale type and condition has its own set of rules and implications. In this blog, we’ll break down the most common sale types and conditions in the real estate market.  

Sale Types

Closing or End Date Sale

This type of sale involves setting a specific closing or end date for receiving offers. All offers are presented to the seller after this specified date. However, it’s important to note that the property can be sold prior to the elected date, and offers can be presented before that date as well. This type of sale provides a clear timeline for potential buyers and a sense of urgency to make their offers.

Auction

Auction sales are dynamic and typically involve an auctioneer who conducts the sale. The property can be sold before the auction date if a buyer makes an acceptable offer. The term “passed in” refers to when a property does not reach its reserve price at auction. In this case, negotiations can continue with interested buyers. Auctions are often exciting events, but they require a good understanding of the process.

Private Treaty

This is the traditional type of sale that most people are familiar with where the property is listed with an asking price. Buyers can make offers at any time, and negotiations typically follow. It offers a more straightforward and familiar approach to buying and selling real estate.  

Conditions

Finance 

Buyers often rely on financing through a bank loan to purchase a property. The finance condition specifies an approximate percentage of the purchase price that the buyer will secure through a bank loan. One the loan has been secured it’s a downhill sprint getting pre-settlement inspections completed and ticked off before your settlement date.

Cash Purchase

Cash buyers are those who can purchase a property outright without relying on a bank loan. This type of sale usually results in a faster settlement process because there’s no need to wait for finance approval. Cash buyers typically provide proof of funds to demonstrate their ability to complete the transaction.

Subject to Sale Condition

This condition applies when a buyer’s current property has not yet been sold, and they need the proceeds from that sale to finance their purchase. It allows the buyer to proceed with the purchase of a new property contingent upon the successful sale and settlement of their existing property.

Subject to Settlement Condition

In contrast to subject to sale, subject to settlement means the buyer’s property is already under offer, possibly with finance approval in progress. This condition ensures that the sale of the buyer’s property proceeds smoothly and provides the funds required for the new purchase. Both subject to sale and subject to settlement can be written to have the settlements coincide if possible. This makes things easy for everyone as everyone moves out and in within the same couple of days.

As Is / As Is Where Is

Properties listed as “As Is” or “As Is Where Is” indicate that pre-purchase inspections such as timber pest or structural do not form part of the contract. This means that the buyer is purchasing the property in its current condition, and the seller makes limited representations or warranties regarding its state. It’s essential for buyers to conduct thorough due diligence when considering such properties.     Understanding these sale types and conditions is crucial for both buyers and sellers in the real estate market. Each option offers unique advantages and considerations, so it’s essential to work with a qualified real estate agent or legal professional to navigate the complexities of property transactions successfully. Whether you’re looking for a fast cash purchase or prefer the structure of an auction, there’s a real estate sale type and condition that can meet your needs.  

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