Just Put in an Offer for an Old House, Have Few Questions Regarding The Offer and REA Tactics

Hi All (Thanks and appreciate if you somehow read through the long story below),

Gooday. I have been actively searching for houses in Tassie for past 3 months now and recently put down an offer for an old place (Built 1961). The property (as told to me by REA) has been sold by a bank (who have outsourced this to a third party mortgage agency based in Mel) as the previous owner (I presume) has gone bankrupt. It has been a rental for over 9 years and needs lot of work (for instance bathrooms, kitchen, garage to name a few) which is rightly reflected in the asking price and the offer I have put in.Its been on market for over 4 months and even had an auction run for it (which didnt go that well here in Tassie). Now here is the lifecycle of things that happened:

1) Day 1 -> I go and see the property, like it so much and put in an offer on the spot (I sign the contract, general 6 page document with building inspection and finance clauses). REA is happy (rather surprised and does mention me that there are no current offers on property).
2) Day 1 (evening): Missus unhappy as I put in a contract without showing the property to her, so I call REA and tell him to withhold the offer for now until I show the property to missus.
3) Day 2: Take missus with me and show her the property, she agrees and the offer is back on table again (Missus tells me that I offered too much and that I should offer a little less than earlier price). I go and inform REA about this and he doesnt let me decrease anything on it (TELLING ME THAT the bank know I have money and would not agree to reducing any further). No fuss, as it wasnt a great decrease and we are happy to pay that amount. The offer is still open.
4) Day 3: The REA calls me to say that bank solicitors now want me to sign a new contract document so he comes to my office and makes me sign a 26 page document as opposed to a 6 page document that I signed earlier (Reason he mentions: the Bank wants to save their A$$ +++). I have a read through (not much I can understand anyways) and sign the contract with the same 2 clauses (finance+building inspection) to save my A$$.
5) Day 4: The REA calls me and tells me that a buyer agent (on behalf of someone in sydney) has put in an offer and that it is his duty to inform me that another offer has come in (He wanted me to increase the offer and I outrightly refuse to pay a cent more).
6) Day 5,6,7 and counting: No reply from REA

Now:
1) In hindsight, he didnt make me sign a buyers declaration. Doesnt seem right to me ?????
2) On the call on day 4, he did mention that my offer was better amongst the two and even told me that the other offer was equal to mine (mine deposit being more). He shouldnt have told me that ??????
3) Is not showing any interest in replying back to me or assuring me of a quick reply for past 3 days (I think he wants me to get anxious and possibly increase my offer)

What to do:
1) Wait for another 2 days and withdraw the offer (As I didnt put an exit date on my offer)
2) Wait forever and let him come back ??????

Interested to see what you guys say?

Regards

Comments

  • +3

    Play on your terms, not theirs. If you fall into their games, you will become emotionally attached and not be able to get out easily.

    If you and the vendor have signed the contract already, then the deal is done. The RE shouldn't be even talking to other buyers.

    • +2

      I agree with airzone, last thing you want to do is base this financial decision on emotion. You may have shown too much interest in the property and he is trying to see if he can get more money from you.

  • +2

    Having read your summary on the property condition and lack of interest from other buyers, I would not have given an immediate offer until I had a property inspection (building and pest) done on it by a professional.
    I would have also gotten my solicitor to review the contract in case any changes needed to be made to cover your A$$ and potentially avoid the situation you have here. Once all the kinks had been identified then I would consider how much to offer for the property (after discussions with my SO).

    I am surprised that after the contract was signed on Day 4 the REA requested a higher price based on a new offer coming in. The way you might get around this is to say that you have another property you are interested in and will be putting in an offer for this place by X date to call his bluff.

    Also, I may be wrong about this but isnt it once you've signed the contract and given the deposit the previous owner/bank cannot back out of it? This may have been covered in the contract you signed.

  • Thanks All,

    Apologies few things to clear here. I have put in an offer, that is I have signed the contract but am not sure if this has been signed by the other party (Bank) yet as I havent been informed by the REA. He tells me that the bank take their own sweet time to sign (as opposed to if it was an individual where the REA might have the offer signed in middle of night by approaching the individual).

    @Airzone/sagrules: Yes I agree, I have been trying to keep emotion away from this but it gets tiring sometimes (I think I am being truthful to the agents here while they dontget honest with buyers often).

    Day 4 high price tactic happened because I didnt sign the buyer declaration which if signed would have limited my chances of putting a higher offer unless my previous offer was rejected by the bank. This is why I think he didnt make me sign the buyers declaration and possibly there was no contra offer at all (the buyer agent one he mentioned)
    And yes it was naiive of me to sign the contract on day 1 on inspection itself. I agree and would stay away from such behaviour in future. I forgot to mention here that one of my office colleague is next door neighbor to the property and gave me some good feedback for the area (if not the house as it was long term rental).

    I tried telling the agent that I was inspecting some other properties and may have to withdraw the offer in case I dont get an answer by today evening. He just said No worries :) …… I guess he is testing my limits here.

    Appreciate the feedback here.

  • +3

    No 1 bad move making a decision on a capital purchase without informing your partner… houses, cars, large electrical items.. You would want her to contact you before such a decision so the same applies in reverse.

    When buying something.. house or car etc the value of that item is what it is worth to you, not a cent more.
    Do not fall in love with something and get carried away because you will find one better and cheaper the next day.
    You have made your offer and you are happy with it, so stick to that. The only thing I would do is inform the rea in writing (email?) that your offer still stands and will do so for ? 5 business days. Advise that you are not interested in increasing your offer. If the property is still available after that time say that you may still be interested but at a reduced offer price. Put the weight back on them.

    There is a good chance they are playing you.. they sensed that you are NEW to all this and it is worth a try.
    REA's are not honest people.. as much as they may seem to be your best friend they are NOT.

    Anything verbally promised or advised by ANY salesman should be treated as a lie or unfulfilled promise unless it is in writing.

    If you need more guidance seek out a local conveyancer or even solicitor and have a chat to them. You will need one eventually anyway so why not break the ice now?

    • Thanks , agreed. I think they are playing me here. Getting some motivation here for making the next move. I have started getting some quotes on solicitors and mortgage agents here. Appreciate the good advice here.

      • +1

        Don't hesitate to pop in and have a word with one or two. Most are very helpful (some are not lol) and will not charge for 5 min of their time. They see people in your predicament all the time.
        You are making a big decision… take your time, move when you are happy to do so, don't get pushed.
        Good luck! Nothing like owning your first property :-)

      • Some conveyoncer/ solicitor will review several contracts at no extra cost so ask them about that as well. Especially if the sale falls through and you find a better place.

  • BTW… when you finally do hook a place, and you will :-) don't use the REA's recommended building inspector.
    It is really worth every cent to get a thorough inspection done so make some effort to find the best.
    Pest inspection is not so necessary… building inspector would locate white ant damage just as good as they would.

    • +1

      Sure, funnily enough the REA recommended me building inspector and loan agent while I was signing the offer. I have started the search out for both these and the conveyancer. Regards

  • Having a read through some of the posts in here might help also…
    https://forums.whirlpool.net.au/forum/138?&g=226

  • +3

    If you have this contract, you should take it to a solicitor, rather than discussing this here, where no one can tell you what the contract obligates you and the seller (bank) to do.

    Everythinhg else is pissing in the wind.

    If you want the place, find out what recourse the signed documents give you and only a legal reading of these by a professional will give you any hope.

    • +1

      Thanks Rocky. AM in process of finding one. Appreciate the advice.

  • Hi All, appreciate the good advice here. I just called the REA and he mentioned there are 2 more offers on the property and the bank could take 2,3 7 or more days (exact wording he used) and he has no control over them. I think I would take the stress out of the situation and give a 48 hours ultimatum tomorrow post which my offer would lapse.

    Dont want to complete with multiple people/offers (which may not exist at all). Regards

    • +1

      Dont delay see the solicitor, if you signed a contract for sale then you may have rights, if it wasnt a contract then you might not.

      Then there is offer and acceptance, if they issued you a contract to sign it might be binding.

      Its called Gazumping, and its not legal in some states.

  • Op can't the vendor to sell if the vendor hasn't signed a contract.

  • best to retract the offer; get a valuation done first and ask what land value is; it might e best to bid low and consider a new build which might be cheaper than extensive renovations; never use the agent's buddies who may be beholden to them and not give you right advice. vet the building etc inspectors to ake sure they don't bail out on you with wolly advice and then you find yourself caught. strange that the home had no offers and now suddenly there are so many. retract all offers. study the auction bids before the vendor bid [a misnomer]. look at other properties which might be similar and in better condition and cheaper. rent in the area. others will come along. it seems there is a new recession looming so that will crash all prices RBS forecast on world recession this year.

  • Update guys: My offer dint get accepted. Strange someone was even more keen to outbid me. Glad and am relieved now, I can finally look at other properties. In Hindsight, I think REA may have used my offer to secure something bigger for that place. Nonetheless it was the last price I was paying anyways. Thanks to all that responded. I am more enlightened than I was last week :)

    • This is called Gazumping.
      Pity that a lot agency employ this tactics.

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