How to Make a Pre-Auction Offer in Australia
Making a pre-auction offer is one of the smartest strategies available to property buyers — but most buyers do not know how to do it correctly. A well-structured pre-auction offer can secure a property before competition arrives and sometimes at a price below what auction would have achieved. Here is exactly how it works.
What Is a Pre-Auction Offer?
A pre-auction offer is an offer made to the vendor before the scheduled auction date. Vendors can accept, reject or counter a pre-auction offer. If the vendor accepts, the property is sold and the auction is cancelled. Most vendors will only accept a pre-auction offer if it is strong enough to make the auction risk not worth taking.
Why Would a Vendor Accept a Pre-Auction Offer?
- The offer is at or above what the vendor expects to achieve at auction
- The offer has minimal conditions (ideally unconditional or finance only)
- The settlement terms suit the vendor’s timeline
- The vendor is motivated by certainty over the risk of a poor auction result
How to Structure a Pre-Auction Offer That Gets Accepted
Step 1 — Know the Property’s Real Value First
Pull comparable sales for similar properties in the same suburb over the last 6 months. Identify what this property would realistically achieve at auction. Your pre-auction offer needs to be at least at, or preferably above, that figure to motivate the vendor to call off the auction.
Step 2 — Minimise Conditions
Vendors accept pre-auction offers partly for certainty. A conditional offer (finance + building inspection) is less attractive than an unconditional offer. If you want to include conditions, complete your building inspection and have finance pre-approved before making the offer — then offer with finance already confirmed.
Step 3 — Include Flexible Settlement Terms
Ask the agent what settlement period the vendor prefers. Matching the vendor’s ideal settlement date significantly increases the attractiveness of your offer without costing you anything.
Step 4 — Put It in Writing Promptly
Pre-auction offers made verbally are easy to ignore. Put your offer in writing with a short expiry (24–48 hours) to create urgency without being aggressive. Your solicitor should review the contract before you sign.
Pre-Auction Offer vs Auction — What Is the Risk?
| Pre-Auction Offer | Auction | |
|---|---|---|
| Competition | None (just you and the vendor) | All registered bidders |
| Price outcome | Negotiated — can be below auction outcome | Market driven — can exceed expectations |
| Cooling off | Usually applies | Does not apply |
| Vendor motivation needed | High — must be better than auction risk | Low — vendor just wants the best bid |
Frequently Asked Questions
How much above the price guide should a pre-auction offer be?
Typically 5–15% above the listed price guide, depending on how competitive the suburb is and how motivated the vendor is. A Collings Property Advisor can give you a comparable sales analysis to set the right number.
Can the agent share my pre-auction offer with other buyers?
Agents are not supposed to disclose the value of your offer to other buyers, but they can tell other interested parties that an offer has been made — which may prompt competing offers. Ask the agent directly about their process.
What happens if the vendor rejects my pre-auction offer?
You can still bid at the auction. Rejecting a pre-auction offer does not affect your right to participate in the auction.
Get Professional Support Making Your Pre-Auction Offer
A Collings Property Advisor provides comparable sales analysis, offer structuring and negotiation strategy for pre-auction purchases — giving you the best chance of securing the property at the right price. Fixed fee $4,500 + GST. Get started at collings.com.au/portal.
