Private sales

dna4 · 13th Oct, 2013

Hi guys,

Need a valuable advise on my situation.

We are looking to buy the 2nd property to accommodate growing family.

We inspected the one of the house we liked about 2months ago - we liked it hence we asked for the contract from the agent.We didn't agree on the price and we were happy to pay the asking price.
Upon further financing enquire with the bank , we unable to borrow the fund to proceed with the property.
I never deal with the agent since then.

2month passed and the property had been re-listed as the private sales.

My questions:

1.Can i deal with the owner directly or should i go back to the agent who i spoken to?
2. If I proceed with the house, will i be liable for the agent commission ?
3. Any hints or tips regarding private sales property?

Thank for the response in advance.

marks · 14th Oct, 2013

The agent's commission is the vendor's problem not yours. You can approach a vendor even when an agent is involved. They don't like it but the agents aren't working for you are they? (unless you are talking about a buyer's agent)
I've approached a vendor once by knocking on the door and having a discussion around the presentation of my offer. The agent hadn't presented it yet I wanted the vendor to know.... And to know why...

Go and have a talk to the vendor, you might get some inside info of the house and why. The worst that could happen is they may not talk to you or point you to another agent.
It could be advantageous to you around working terms (vendor finance, settlement periods) than just price to help with getting finance. Two more things agents aren't keen on.

Good luck and tell us how you went with the enquires.

dna4 · 14th Oct, 2013

marks said:
The agent's commission is the vendor's problem not yours. You can approach a vendor even when an agent is involved. They don't like it but the agents aren't working for you are they? (unless you are talking about a buyer's agent)
I've approached a vendor once by knocking on the door and having a discussion around the presentation of my offer. The agent hadn't presented it yet I wanted the vendor to know.... And to know why...

Go and have a talk to the vendor, you might get some inside info of the house and why. The worst that could happen is they may not talk to you or point you to another agent.
It could be advantageous to you around working terms (vendor finance, settlement periods) than just price to help with getting finance. Two more things agents aren't keen on.

Good luck and tell us how you went with the enquires.

Thank for your reply and advice.

The vendor actually terminated his arrangements with this RE. I think it is a good way for him to save the commission plus the agent was pretty slack.

He didn't even make a time to show the property for second time.

Will talk to the vendor and see how much he wanted. I hoping he will drop the asking price given he won't need to pay agent selling commission. OR its just my wishful thinking.

Propertunity · 15th Oct, 2013

Be VERY careful if you proceed to purchase, as many contracts of sale in NSW have a clause which passes the liability onto the purchaser in case of a commission claim by the agent that originally introduced you to the property.

Even though a claim for commission by the agent would likely fail as he/she was not the "effective cause of sale", you just don't want the hassle.

TMNT · 15th Oct, 2013

Propertunity said:
Be VERY careful if you proceed to purchase, as many contracts of sale in NSW have a clause which passes the liability onto the purchaser in case of a commission claim by the agent that originally introduced you to the property.

Even though a claim for commission by the agent would likely fail as he/she was not the "effective cause of sale", you just don't want the hassle.

really? I thought the agents claim to teh comission is pretty solid unless extreme circumstances

dna4 · 15th Oct, 2013

I haven't got call back from the vendor.

I think I need to get some legal advise from the solicitor in regards to the commission.

That's the last thing I want to happen : the agent knocking the my door to claim the commission that he doesn't deserve.

Do you know if I can put special clause to prevent the claim of commission?

Scott No Mates · 15th Oct, 2013

If there is a clause seeking confirmation of an agent's introduction - then declare it (after seeking legal advice). If you need a clause to cover you, make sure it absolves you of any liability for agent's commission and also provides a date of introduction to the property so that if there is a sunset clause in the vendor's agent contract, it can be quashed.

marks · 16th Oct, 2013

Scott No Mates said:
If there is a clause seeking confirmation of an agent's introduction - then declare it (after seeking legal advice). If you need a clause to cover you, make sure it absolves you of any liability for agent's commission and also provides a date of introduction to the property so that if there is a sunset clause in the vendor's agent contract, it can be quashed.

Is that in the NSW RE sales contract? Wow, interesting catch there. Is that to ensure there is a cheque at settlement for the REA if the deposit doesn't cover it?
I presume nothing has been signed by the purchaser in this case?
I have seen some purchase contracts in Qld (where we submit offers with a contract rather than a phone call) have the REA insert a clause to ensure they get paid with a cheque at settlement.

Cheers.

Private sales

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