A Melbourne real estate agent reckons he’s found a way to effectively sell homes under stage four restrictions.
A real estate agent in Melbourne’s west believes he has found a loophole that will allow sales to proceed despite the ban on physical inspections.
Hocking Stuart Altona and Williamstown director Anthony Anile’s solution is adding a clause to the sales contract making the deal “conditional upon a satisfactory inspection”.
This way, the physical inspection could be done “after a contract is exchanged” rather than the usual before.
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Mr Anile said his lawyers had confirmed the clause was legally compliant, as physical pre-settlement inspections were permitted under Melbourne’s stage four lockdown.
But a prominent buyer’s advocate has warned purchasers and sellers considering going down this road to tread carefully.
The state government’s road map for reopening revealed on Sunday in-person home inspections wouldn’t be allowed again until at least October 26.
“We would make sure the purchaser had a good look at the property online, in photos and virtual tours, that they had their finances approved and had a genuine need to buy,” Mr Anile said.
“We would then negotiate the price between the parties as usual, with the physical inspection occurring after contracts had been exchanged.
“If the buyer didn’t like the property for whatever reason, they wouldn’t need to pursue that contract, there’d be no penalty or fee.
“This move is to help sellers who have a genuine need to transact with genuine buyers, not to skirt the need to keep our community safe.”
Premier Daniel Andrews’ road map revealed physical home inspections would be banned until at least October 26. Picture: NCA NewsWire / Andrew Henshaw
The business.vic.gov.au website confirms a buyer can attend a property by private appointment for pre-settlement purposes if they must, and if physical distancing is maintained and face coverings are worn.
But it advises pre-settlement inspections “should be conducted remotely where possible”.
Mr Anile said his offices hadn’t completed any sales using the clause yet. But he expected it to give the 40-odd properties his agency had on the market in the Hobsons Bay area a better chance of transacting under the stage four lockdown. The same clause could apply to leasing arrangements.
“It’s out of the box. But COVID-19 has taught us to be flexible,” he said.
Philip Webb Real Estate founder Philip Webb said his agency was also giving tenants “an option of an out” if they discovered something “drastically wrong” with a property they leased sight-unseen during stage four.
Real Estate Buyers Agents Association president Cate Bakos said a buyer or seller would “need to have a compelling reason with significant time pressure” to go down this path.
Buyer’s advocate Cate Bakos advised buyers to engage their lawyers before agreeing to the clause.
Would-be purchasers must run the clause past their lawyers to ensure it’s “water tight”.
“If a purchaser is not in a position to travel to the property, for example if they’re sick, they might fall foul of the clause,” she said.
“A vendor could enforce the contract on the basis the purchaser hasn’t made a fair enough attempt.”
Ms Bakos said a vendor could be risking missing an opportunity to sell their home to “someone who is already familiar with the property, or who is prepared to buy sight-unseen for a higher price” by getting locked into a conditional contract.
She said while the real estate sector was eager to get rolling, “we have to be patient and hope it will be less than seven weeks” until physical inspections resumed.
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