Conditional vs unconditional offers, from the seller side
In short
What subject to finance, building and pest, and subject to sale actually mean for a seller, when an unconditional offer is worth less than it looks, and how to tighten conditions instead of rejecting them.
On this page
The plain definitionsWhen unconditional is not the best offerWhen conditional is fineCooling-off is a condition tooWhat helm does with conditionsSourcesMost of what is written about conditions is for buyers. This is the other side of the table.
The plain definitions
An unconditional offer has no escape hatches beyond the statutory cooling-off period (if your state has one). Once the contract is signed or exchanged, the buyer is generally bound to complete, and risks the deposit if they do not.
A conditional offer has one or more clauses that let the buyer walk away without penalty if something does not happen by a date. The three you will see most:
| Condition | What it means for you | Typical window | How sellers tighten it |
|---|---|---|---|
| Subject to finance | The buyer needs a loan approved on this property. The bank will value it. If the valuation or the buyer's position falls short, the sale collapses | 14 to 21 days | Ask for evidence of pre-approval, shorten the window, and make the clause specific: lender named, amount stated, date fixed |
| Building and pest | The buyer can withdraw if the inspection turns up something they do not like. Some contracts let them walk for any defect; others only for major structural or active termite findings | 7 to 14 days | Agree the standard: "major structural defect or live termite activity" is common. If you commission your own report, ask your conveyancer how to share it, and never conceal a defect you know about |
| Subject to sale | The buyer has to sell their own home first. Your sale is now tied to a sale you cannot see | 30 to 90 days | Add a sunset date and a 48 or 72 hour clause, drafted by your conveyancer: you keep marketing, and if a better offer comes in the buyer has two or three days to go unconditional or step aside |
There are others: subject to due diligence (common in Queensland, and broad), subject to a valuation, subject to FIRB approval, subject to the buyer's solicitor approving the contract. Each one is a date and a reason the buyer can leave. Your conveyancer will tell you which are normal in your state and which are unusual.
When unconditional is not the best offer
An unconditional offer at a lower price is sometimes the better deal, because it is a sale, not a maybe. But not always.
- A cash unconditional offer at 5% under a conditional offer can be the stronger position if you value certainty or have your own purchase lined up.
- An unconditional offer with a 120-day settlement may be worse than a conditional one settling in 45 days, depending on what you need.
- "Unconditional" in a state with a cooling-off period still has a cooling-off period. In NSW that is five business days at 0.25%; in Victoria three clear business days at $100 or 0.2%, whichever is greater; in Queensland five business days at 0.25%. In NSW (with a 66W certificate) and Queensland (by written notice) a buyer who wants certainty can waive it. Victoria's rules are different, so ask your conveyancer before relying on any waiver. In WA and Tasmania there is no cooling-off, so a signed contract is a signed contract.
When conditional is fine
Nearly every owner-occupier offer is conditional on finance, and a finance clause with a named lender, a stated amount and a 14-day window is a normal, healthy offer. Rejecting it outright means rejecting most of the market. The move is to tighten, not to refuse.
The condition to be most careful with is subject to sale. Without a sunset clause and a 48 or 72 hour clause, your listing is effectively off the market while a stranger tries to sell their house. If a better offer does arrive, do not sign with the second buyer until the first contract has been properly ended; your conveyancer serves any notice under the clause. If another buyer appears while you are waiting, our guide to handling two offers at once covers how to run a fair process.
Cooling-off is a condition too
Even a clean contract has one built in, in most states. It is worth knowing the number for yours before you accept anything, because it decides when you can stop taking calls from other buyers. Our guide to what happens after you receive an offer sets out when the sale becomes binding in each state.
| State | Buyer cooling-off | Penalty to withdraw |
|---|---|---|
| NSW | 5 business days after exchange | 0.25% of price |
| VIC | 3 clear business days from when the buyer signs | $100 or 0.2%, whichever is greater |
| QLD | 5 business days from receipt of signed contract | 0.25% |
| SA | 2 clear business days | Up to $100 of the deposit |
| WA | None | n/a |
| TAS | None | n/a |
| ACT | 5 business days after exchange | 0.25% |
| NT | 4 business days | None |
None of these apply to auction sales, and most states have other exceptions, so your conveyancer confirms how cooling-off applies to your contract.
What helm does with conditions
helm's offer scoring reads the conditions, not just the price. Each condition lowers an offer's score and several compound, so an offer subject to finance, a building inspection and the sale of the buyer's home scores lower than one subject to finance alone at the same number, and the notes say why. It is a way to see all your offers on the same terms before you and your conveyancer make the call. The decision, and any counter-offer, is yours. Our FAQ covers how to tell whether an offer is fair.
Sources
Consumer Affairs Victoria, Buying property by private sale and Selling property by private sale. Queensland Government, Contract of sale (conditions) and Cooling-off period pages. Consumer Protection WA, Real estate contracts: sale by offer and acceptance (48-hour clause; no cooling-off). NSW Government, Contracts and deposits when buying property in NSW (cooling-off, 66W). SA.GOV.AU, Offers, auctions and buying off the plan. Access Canberra, Reality Check guide. NT.GOV.AU, Contract of sale. Hobart Community Legal Service. General information, not legal advice.