Negotiating a Private Treaty Property Purchase

A private treaty sale is the most common method of selling residential property in Australia. Unlike auctions, this process gives both buyers and sellers more flexibility.

The property is listed with an asking price, and interested buyers can submit offers at any time during the campaign.

There’s no public bidding or fixed sale date, making it ideal for buyers who prefer a less pressured approach.

Typically, the vendor sets a price based on recent comparable sales in the area, and the property is then advertised across real estate portals like realestate.com.au and Domain.

Inspections are arranged privately or via open homes, and potential buyers are invited to submit their offers directly to the agent.

From there, negotiations begin and can go back and forth until an agreement is reached. Once both parties agree on the terms, the contract is signed, and the property is officially under offer.

Why Private Treaty Appeals to First Home Buyers

For first-time buyers, private treaty sales often feel less intimidating than auctions. There’s time to research the market, inspect the property more than once, and discuss conditions with your conveyancer or solicitor before making an offer.

Private treaty purchases also allow you to include conditions in the contract, such as being subject to finance approval or building and pest inspections. This added protection is especially important for buyers navigating the process for the first time.

Importantly, private treaty offers room for negotiation. Depending on the market and the seller’s situation, you might be able to purchase the property for less than the advertised price—something far less likely during a heated auction.

Making an Offer the Smart Way

When preparing your offer, it’s essential to base it on solid research. Look at recent comparable sales in the same suburb, and consider how long the property has been on the market. If it’s been listed for a while, the vendor may be more open to a lower offer.

On the other hand, if interest is high or the home is newly listed, you may need to come in closer to the asking price to be considered seriously.

It’s generally advisable to start your offer slightly below your maximum budget. This gives you room to negotiate and avoids overextending yourself emotionally or financially.

Just be mindful not to lowball to the point where the vendor won’t engage at all.

Including conditions—such as “subject to finance” or a satisfactory building inspection—is common practice and can protect you from unexpected issues.

However, be careful not to overload your offer with too many conditions, as this may deter the seller.

Common Mistakes First Home Buyers Should Avoid

One of the biggest errors is making an offer without having your home loan pre-approval in place. Without it, your offer won’t carry as much weight with the agent or vendor, and you could risk missing out if someone else is ready to move faster.

Another mistake is relying on verbal offers. Real estate transactions require everything to be in writing, so be sure to have your offer prepared formally by your conveyancer or agent.

Also, don’t forget to budget for all associated costs. Stamp duty, legal fees, building and pest inspections, lender’s mortgage insurance (if you’re borrowing more than 80%), and utility connection fees can all add up quickly.

When Private Negotiations Turn Into Auctions

In a competitive market, private treaty sales can quickly shift into what feels like an unofficial auction. When agents are dealing with overwhelming interest in a property, the negotiation process can become murky and high-pressure.

Buyers may find themselves being asked to significantly increase their already strong offers—sometimes by tens of thousands of dollars—without any transparency about competing bids.

In these situations, it’s often unclear whether the competition is genuine or simply a tactic to push buyers higher. With little visibility, buyers risk bidding against phantom offers, giving the agent full control of the process.

This lack of clarity can lead to frustration, mistrust, and in some cases, failed negotiations where buyers walk away before their maximum price is reached.

To regain control and transparency, agents may opt to convert the negotiation into a “boardroom auction.”

This is a closed, invitation-only bidding process—held either in the agency’s office or via video conference—where interested parties submit competing bids in real time.

While not open to the public like a traditional auction, it operates similarly: the highest bidder secures the property.

This shift underscores the importance of being prepared, understanding the market climate, and knowing when to stand firm or walk away.

Negotiation Tips and Market Insight

In a slower market, offering around 4% to 6% below the asking price can be acceptable, especially if the property has been on the market for a while.

But in a competitive or rising market, you may need to offer at or even above the asking price to secure the property.

Understanding the vendor’s motivation can help guide your offer strategy. If the seller is looking for a quick settlement or has already bought elsewhere, they might accept a more modest offer with favourable terms.

Lastly, try to remain emotionally detached from any one property. Getting too attached can cloud your judgment and lead to overpaying or accepting unfavourable terms. Be prepared to walk away if it doesn’t feel right.

Private treaty sales offer more breathing room and negotiation flexibility than auctions, making them an excellent option for first home buyers in Australia.

But preparation is key. Ensure your finance is pre-approved, research the local market, and present a well-considered written offer with appropriate conditions.

If you approach the process strategically, buying through a private treaty can be a smart, low-stress path into the property market.