Most frequently asked questions about buying and selling property
Buying or selling a house is not something you do every day. It is therefore not surprising that you have all sorts of questions. An NVM broker will be able to answer your questions. The NVM has already made a list of the most frequently asked questions.
1. When am I in negotiations?
You are only in negotiations with the selling party if he or she responds to your offer by:
a) Making a counter-offer.
b) Explicitly stating that you are negotiating.
You are therefore not yet negotiating if the seller's broker says that he will discuss your offer with the seller.
2. Is a seller's broker allowed to conduct viewings if there are already negotiations about a bid?
Yes, this is permitted. Negotiations do not have to result in a sale.
The seller will probably also want to know if there is more interest in the property. He is also allowed to negotiate with several potential buyers. An NVM broker has to make this clear to all the parties.
The seller's NVM broker will often inform interested parties that there is already an offer or that there are negotiations taking place. You can make an offer in that case as a potential buyer, but the broker will only commence negotiations with the other parties once the negotiations with the first candidate have ended. The NVM broker cannot say anything about the size of the offers.
This might otherwise result in an auction.
3. If I offer the asking price, is the seller obliged to sell me the property?
No, the seller is not obliged to sell you the property. The Supreme Court has determined that the asking price must be viewed as an invitation to make an offer. Even if you offer the asking price, the seller can therefore decide that he will or will not accept your bid, or make a counter-offer (through his broker).
4. Is the seller allowed to change the asking price of a property during the negotiations?
Yes, the seller can decide to increase or reduce the asking price. As a potential buyer you also have the right to reduce your offer during the negotiations. This means that your previous offer will be void as soon as the selling party makes a counter-offer.
5. How is the purchase completed?
If the seller and the buyer agree on the most important points – including the price, transfer date, resolutive conditions and any arrangements about movable contents – then the seller's NVM broker will set these arrangements down in a sale agreement. The purchase is only completed when both parties have signed the sale agreement. Resolutive conditions are an important matter. If you want these to be included in the sale agreement, then this has to be taken into account during the negotiations. As a buyer you are not automatically granted a resolutive condition.
The seller and the buyer must agree on the additional arrangements and resolutive conditions before the sale agreement is drawn up.
Examples of resolutive conditions are:
1. Financing condition.
2. No housing permit.
3. Adverse building survey.
4. Failure to obtain a National Mortgage Guarantee.
5. NVM No-Risk clause.
The purchase is only completed when both parties have signed the sale agreement. This is termed the requirement for a written agreement.
As soon as the seller and the buyer have signed the sale agreement and the buyer (and possibly the notary) have received a copy of the agreement, the legal cooling-off period will commence for the private buyer (see question 11). You as the buyer can still cancel the purchase within this time. The purchase is final after this time, unless the resolutive conditions apply.
6. Is an NVM broker allowed to change the sales method during the negotiations?
Yes, this is allowed. Sometimes there are so many potential buyers who offer or approach the asking price that it is difficult to decide who the best buyer is. At that time the seller – on his broker's advice – can decide to amend the offer procedure by making this a tender procedure, for example. In this procedure all bidders have an equal chance of submitting a bid. The broker must of course comply with any previous promises or agreements before the procedure is modified.
7. Is an NVM broker allowed to ask an exorbitant and unrealistically high price for a property?
The seller will decide the price he wants to ask for his property in consultation with his NVM broker. The buyer can negotiate on the price, but the seller decides.
8. What is an option?
The term 'option' is used in two ways:
- In a legal sense an option grants a party (in this case the buyer) the choice to conclude a sale agreement with another party (the seller) by means of a unilateral declaration. Both parties agree on the purchase conditions, but the buyer will for example be given another week's cooling-off period. Such an option is usual when buying a newly built property, but not in the case of an existing property.
- It is in fact incorrect to use the term 'option' when purchasing an existing property. 'Option' in that case means certain agreements which a seller's NVM broker makes with an interested party during the negotiating process.
An example of this is a promise that the buyer will be granted a couple of days to change his mind when he makes an offer. The buyer can use this time to gain a better view of his finances or potentially how to use the property. The NVM broker will inform other interested parties during this period that there is an option on the property. You cannot demand an option. The seller will decide in consultation with the NVM broker whether such options are to be granted.
9. Does the broker have to negotiate with me first if I am the first person who arranges a viewing? Or if I am the first to make an offer?
No, this is not required. The seller will decide with the seller's broker who he will negotiate with. If you are the buyer, ask the seller's broker in advance about the selling procedure that is being used to avoid disappointment.
10. Does the broker's commission come under the 'buyer's costs'?
No, the commission is not included. The following come under the 'buyer's costs':
a) The transfer tax:
b) Notary fees, including for drawing up the deed of transfer and registering this with the Land Registry.
In addition to the above costs there may be notary costs for drawing up and registering the mortgage deed. If the buyer has engaged a purchase broker then the commission for this purchase broker is for the buyer's expense. This is usually charged in the final statement drawn up by the notary. The seller's broker's costs are borne by the seller.
11. What does the three-day cooling-off period mean exactly?
The legal three-day cooling-off period means that you can cancel the purchase without giving any reasons. The three-day cooling-off period starts as soon as a copy of the signed sale agreement has been handed over to the buyer.
The cooling-off period can last more than three days, if it ends on a Saturday, Sunday or legally recognised public holiday. There are rules for this. Your NVM broker can tell you how long the cooling-off period will last.
12. Can I expect to receive advice from the seller's broker if I am the buyer?
The seller's broker looks after the interests of the seller. He will advise the seller during the selling process. The seller's broker cannot therefore represent your interests at the same time. Therefore if you want guidance and advice during the purchasing process, then it is wise to engage a purchasing NVM broker.