Selling Real Estate in Victoria
Everything you need to know about selling property in Victoria.
Are you thinking about selling your property in the state of Victoria? Check out LJ Hooker's guide here and get the process right every time.
In the grand scheme of things, the Victorian property market is extremely strong. High demand from both buyers and vendors means that you need to understand the process intimately to ensure you make the most of the market.
So what do you need to know about selling property in Victoria?
Choosing an agent
A good real estate agent is the starting point for making an excellent property sale in Victoria. They have to act in your best interests, follow your directives and always engage in best practice by law, so you have to ask a few more questions to ensure you find the best fit for your needs.
LJ Hooker has experienced real estate agents right across Victoria who will be able to help you through the sales process. To make sure you are choosing the right agent when you meet with them, you should check:
- Their licensing and authority
- Their commission and fees as well as how they will be charged
- Exactly what services you will get for these fees
- How they will market and sell your property and if they have a track record of success with these methods
- Any extra marketing costs
- Their sales history and knowledge of the local area, in terms of community and price
- How much similar homes are selling for in the area
- What they think your home will sell for - make sure they are not overquoting the price (saying it is higher than it really is) just to get your business, as this is illegal.
If you are satisfied with these responses, then you will sign a sales authority with them. This is a legally binding contract which will include the following details about your Victorian property sale:
- The method of sale
- Commission and fees, with GST also detailed
- What the agent believes the property will sell for
- The amount of time the agent has to sell the home
- When commission is payable and any details on whether it will be shared between agents or agencies
- Any rebates on advertising expenses
- A statement explaining your capacity to complain to Consumer Affairs Victoria should anything go wrong
LJ Hooker has offices right across Victoria and can help you understand the ins and outs of choosing a real estate agent should you need any further help.
Ways to sell property in Victoria
One of the biggest steps for selling property in Victoria is choosing how you will do it. LJ Hooker's real estate agents are well-versed in each and every method of sale and can help you understand each of the following processes.
The different ways of selling Victorian property are:
This is when you, the home owner, set the price tag you want to put on the property for sale. Your real estate agent will then negotiate with each and every interested party, trying to find a willing buyer who will meet your nominated price, or as close to it as possible.
Auctions are public sales, which are operated and managed by an appointed auctioneer. A reserve price will be set, which is the minimum you want the property to sell for. Prospective buyers make bids during the auction on a specific date and the highest bidder above the reserve signs the contract for the property.
Setting a realistic reserve price is important - and something your LJ Hooker real estate agent can provide valuable advice on.
The sale by tender process is one where buyers make offers and include a deposit - normally 5 or 10 per cent of the sale price. You and your agent can then take your time to review these and reject or accept them, depending on where they fall in your expectations.
Over 2014-2015, Melbourne actually had the highest percentage of auction listings as a proportion of total sales, indicating the popularity of this method for selling property in Victoria.
Marketing your property in Victoria
As a popular property market, selling real estate in Victoria means getting your advertising absolutely right so you can maximise the number of prospective buyers that express their interest. Also note that the advertised price of your home must not be less than either the auction's reserve price, or the agent's estimated selling price. There are two main methods of marketing Victorian property for sale:
The Herald Sun is the main newspaper for Melbourne and Victoria, with a Monday to Friday readership of 1.2 million and one million people reading it on Saturdays alone. This kind of exposure means print advertising for your property cannot be overlooked. Seek out papers and newsletters with local circulation as well - your LJ Hooker agent will be able to contact these publications.
In addition to newspaper advertising, going online can be very beneficial for advertising Victorian property for sale. Realestate.com.au, domain.com.au and ljhooker.com.au each have significant viewer numbers and can be an ideal place to start.
Using professionals to capture photo and even video of your home can add significant interest and value to your marketing.
Contracts of sale in Victoria
The contract of sale is one of the most important documents in the selling process. This is the document both you and the buyer sign at the end of the process, but people interested in your home will also use it when making an offer. It contains all of the important details about your property, including the following:
- Address and specifics of the property
- Your personal details and those of the prospective buyer
- Information about your real estate agent, solicitor and/or conveyancer
- How much the property is priced at and the value of a deposit
- Balance owing
- Any special conditions you or the buyer want to include in the contract, such as allowances for home loan approval
- Taxes, council rates, improvements and easements associated with the property
Consumer Affairs Victoria has more details on contracts of sale, and your LJ Hooker agent can help you draw this document up - a process which must take place before the marketing of the home begins.
The cost of selling property in Victoria
There are many costs, both hidden and obvious, that will impact the sale process in Victoria. This includes the following:
- Agent commission - this is specified in your agreement with an agent
- Legal fees involving solicitors and conveyancers which can be between $1,500 and $3,000
- Pest or building inspections, which cost up to $400
- Any applicable land tax - allow up to $1,000, but this scales with the value of your property
- Existing strata fees and council rates to be paid - allow up to $1,000 again for these
- Home loan fees which can cost $1,000, especially if you are switching to a new mortgage
- Cosmetic repairs to your home ahead of advertising may only be a few hundred dollars, while a full plumbing renovation can cost $15,000
- Moving costs can be between $500 and $3,500 depending on how much you own and how far you are moving
Make a note of all associated costs, and plan your budget out well in advance.
Settlement of property in Victoria
Once bidders or buyers state their offers for your property and you are satisfied with the result, the settlement process can begin. This usually takes between 30 and 90 days. The settlement process begins with the exchange of contracts, which will outline the final date of settlement. It is different for each method of sale:
You accept an offer from a buyer, or your agent negotiates them to a level you are satisfied with. The buyer then has three business days to back out of the deal (a cooling-off period) and thereafter you will exchange and sign contracts of sale. A 10 per cent deposit is usually paid at the contract exchange.
If a buyer in Victoria cools off, you must return the deposit, less $100 or 0.2 per cent of the purchase price - whichever of these sums is higher.
Offers can be made in the build-up to an auction, as well as in the three business days after the event (if it did not reach reserve). Your agent can relay these to you. There is no cooling-off period for purchases made at auction, even if the home was sold through these offers. A 10 per cent deposit is paid after the auction or when an offer is accepted. Your agent can provide advice on accepting or rejecting offers instead of going to auction.
Finalising the process
When the contracts of sale have been signed, the Estate Agents Act 1980 requires a copy to be sent to both the seller and the buyer and receipt of this has to be confirmed. State legislation is working to protect both parties all the way through the buying and selling process.
As specified in the Transfer of Land Act 1958, the seller signs the form so as to validate the land changing hands and then it is the buyer's responsibility to complete and file it, including declaring how many people will hold the property title together. After this has been completed, you will have successfully sold your house! Congratulations.
It doesn't have to be tough to sell a house in Victoria and here at LJ Hooker, we'll do our best to make the whole process as relaxing as possible.