Questions about the way bids are dealt with on SLOD!
Answers
What is a bid?
A bid is simply an expression of interest. It's a way of saying to the vendor, "I've had a look at your property, and am interested in buying it. Here's what I'll pay you for it, if you're prepared to accept the terms I have set out."
Having inspected the property and worked out the terms on which you would like to buy the property, you just fill in the Bid to Buy form, by clicking on the "Bid on this Property" button on the property listing, and submit it to us.
TIP: For information on how to make your bid particularly attractive to the vendor, see our section under Making A Knock-Out Bid.
How are competing bids dealt with?
Where more than one bid is received, the vendor will determine which one is the most acceptable. Usually, this is determined on the basis of the amount of the bid.
However, it is possible that conditions attached to the bid may make it less attractive than an unconditional bid for a higher amount.
(For example, a bid that is conditional upon the purchaser's own property being sold will probably not be as attractive as an unconditional bid, even if the unconditional bid is for a lower price.)
SLOD! uses a "star ranking" system to indicate which of two or more bids are more attractive on the basis of conditions the bidder has attached to them. (See next question for more information.)
How long before someone contacts me about my bid?
You will be contacted immediately! The first contact, if you've submitted your bid online, will be an automatic email confirming your bid. You will also see your bid listed in the "Bid History" of the property you've bid on.
We regard prompt contact with bidders as an essential part of our procedure; first to confirm the bids by checking that each bidder and their bid is genuine (see our "Bidding Integrity FAQ"), and second to ensure that each bidder knows that their bid is being acted upon.
The vendor is consulted as soon as possible after every bid is received, and asked for negotiation instructions. As soon as we have these instructions, we will make personal contact with each bidder and commence negotiations.
How does the SLOD! star ranking system work?
A bid that is unconditional (which means that the purchaser has no right to cancel it) is the best deal of all, because the vendor knows that the property is definitely sold.
If the purchaser includes a special condition in the contract, so that the contract can be cancelled if the special condition is not fulfilled, the vendor's sale is uncertain.
(For example, if the purchaser has a special condition in the contract that allows for the contract to be cancelled if bank finance is not approved within 21 days, the vendor knows that the contract could be cancelled three weeks later if the purchaser's finance is not approved. This means that the vendor may have lost other potential purchasers who have moved on since the contract was signed.)
While an unconditional bid would have a "5 star" ranking, a bid that is conditional on bank finance approval may have only a "3 star" ranking.
The vendor will usually give priority to the price of the bid, but the star ranking of the bid will also be a factor when choosing which bid is the most attractive.
How can I use the star ranking to my advantage?
If you are the under-bidder, and you ensure that your star ranking is kept at the maximum number of stars possible, you can seriously challenge the leading bidder. During final negotiations a high star ranking may be of more importance to a vendor than a price that is only one increment above the previous bid.
How can I get the disclosure documents?
It some States it is a legal requirement that any purchaser of residential real estate must be given a disclosure document before any contract is signed. This document can be downloaded from the property listing on this website.
You can also obtain disclosure documents by:
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Calling in at our office in person; |
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Having us post, email or fax the documents; or |
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Requesting us to post, email or fax the documents to your lawyer. |
How long before I find out it my bid is acceptable to the vendor?
You may find out within hours or minutes of having submitted it, if it impresses the vendor! (See "Making A Knock-Out Bid").
The vendor may set a closing date, which is an indication that the vendor has a received an acceptable bid, and is about to enter into final negotiations. The closing date may be very short (a matter of hours) or it may last a few days.
In most cases, bidding lasts no more than a few days once it gets under way.
When is a formal contract prepared?
If your bid is acceptable to the vendor, Lawyers Real Estate will prepare a formal Contract of Sale of Real Estate which both parties sign to complete the sale.
The Contract of Sale of Real Estate is the means by which a purchaser makes a formal and legal offer to the vendor.
How is dummy bidding dealt with?
Dummy bidding is not a problem with SLOD! This is because bids are accountable, and negotiation is not confined to the highest bidder.
Before accepting a bid, and finalising the sale, Lawyers Real Estate will carefully check the bids immediately preceding the highest bid to confirm that they were made legitimately. Such checks include:
- Contacting the person who placed the bid in order to identify them;
- Discussing the bid with the person who placed it, to confirm that it is bona fide;
- Cross checking with the vendor's record of visitors to ensure that the property was visited by the person who placed the bid; and
- Any further checks required to establish the status of the bid.
See also " Bidding Integrity FAQ ".
Does it cost anything to bid on a property?
No. There are no registration fees, agency costs, holding deposits or any other costs associated with bidding on SLOD!.
If I make a bid am I bound by it?
You should not make a bid unless you are genuinely interested in purchasing the property on which you are making your bid, as it is a serious criminal offence to make "dummy bids". See our Bidding Integrity FAQ. Sorry, but we must take every opportunity to warn against, and to deter, dummy bidding.
Your bid is not binding on you or the vendor. A bid is an "invitation to treat", which is legal-speak for an invitation to enter into negotiations with a view to making a purchase, and it does not create any legal relationships.
You will not be legally required to proceed with the purchase of the property you bid on unless, and until, you have signed a formal Contract of Sale of Real Estate. (See Signing A Contract.)
Can I withdraw a bid after I've made it?
There is no need for a bidder to withdraw a bid, as the life a bid is quite short (see "How long does a bid remain on display" below).
Just as the making of a bid requires checks to ensure the bona fides of the bidder, the withdrawal of a bid requires similar checks. This is to ensure that a competing bidder cannot "nobble" the bidding process by falsely removing a competitor's bid.
Any request for the withdrawal of a bid would have to be thoroughly investigated, and by the time the withdrawal was confirmed, the bid would have become invalid anyway.
How long does a bid remain on display?
The life of a bid is not very long. The bid is exposed long enough to allow other potential purchasers to know that someone is interested in purchasing the property, and the amount they are prepared to pay for it. In this way, other potential purchasers can also express interest in the property and all expressions of interest can be dealt with in an orderly manner.
Where only one bid is received
If only one bid is received, it will be displayed while the vendor is consulted and negotiations are commenced with the bidder. If the negotiations fail to take the matter any further, the bid will be deleted.
The bid will remain valid, and on display, until negotiations conclude with the sale of the property or the cancellation of the bid.
Where more than one bid is received
If, while the first bid is displayed, other bids are received they too will be displayed so that all parties can compete. In this case, negotiations may be postponed until a leading bidder emerges.
All bids will remain valid, and on display, until negotiations conclude with the sale of the property or the cancellation of the bids.
How are bidding increments determined?
Bidding increments are determined by the vendor. The purpose of bidding increments is to ensure that bidding takes place in an orderly and realistic manner. Allowing very small bids wastes time, and can frustrate and annoy other bidders.
Can I just by-pass the SLOD! online bidding process entirely if I want to?
Of course. We realise that some purchasers may want to have their own lawyer prepare their offer in its entirety, and to have it sent directly to the vendor's legal representative.
Depending on the vendor's instructions, a formal offer that is received without notice may be exposed to the market through SLOD!, or the vendor may immediately enter into negotiations.
Where an offer is to be exposed to open bidding, Lawyers Real Estate will attend to the uploading of the bid and the person making the offer will be asked if they wish to participate in the SLOD! bidding process.
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