Auction or private treaty in Queensland: how the two methods differ

In this article

Written by

Kooky

Builder of Shaka, the payment router that pays every agent their commission on closing date.

About Kooky and Shaka →

Most homes in Queensland change hands in one of two ways. The owner sets a date and sells to the highest bidder at auction, or the owner invites offers and negotiates with one buyer at a time, which the industry calls private treaty. The house is the same and so is the standard of care expected from everyone involved, but the rules around price, second thoughts, conditions and timing are not.

This guide sets the two methods side by side, using what the Queensland Government and the Office of Fair Trading publish for buyers, sellers and agents, and what the data firm Cotality publishes about how auction results are counted. It covers six differences: how price is shown, whether the buyer has a cooling-off period, what conditions a buyer can attach, when the contract and deposit happen, when the seller's disclosure documents must be handed over, and where each kind of sale turns up in market statistics. It describes the rules. It does not rank the methods, because which one suits a particular home is a decision for its owner.

Two ways to reach the same contract

The Queensland Government's guidance for sellers describes private treaty as the most common method. The seller markets the property and invites offers from prospective buyers, negotiates with a buyer, usually through an agent, and signs a written contract to complete the deal. The same page describes a third route, sale by tender, in which buyers lodge offers by a set deadline and the seller accepts the best one or rejects them all.

An auction compresses the negotiation into a public event on a fixed day. The government's guidance on buying at auction says only registered bidders can bid, the seller can set a reserve price, and once bidding reaches the reserve the property is on the market and is sold to the highest bidder.

Both paths end in a written contract of sale and a settlement date. What differs is how a buyer gets there, and how much room each side has to step back along the way.

How the price is shown

This is the difference a buyer meets first, usually on a listing page.

For an auction property, the Office of Fair Trading's guidance for the industry is direct: an agent or auctioneer must not publish any price guides for potential bidders. The government's page for buyers puts the same rule from the other side, saying it is illegal for a seller or their agent to give a price guide for a property going to auction. The Office of Fair Trading explains that the purpose is to avoid misleading consumers.

The rule reaches into property websites. According to the same guidance, an agent may supply a price to an online listing site so the site's search can work, but the site may not show that price. Instead the listing carries a set statement: that the property is being sold by auction or without a price and therefore a price guide cannot be provided, and that the website may have filtered the property into a price bracket for website functionality purposes.

There is one document a bidder may be shown. Before recommending a reserve, the Office of Fair Trading says, an agent gives the seller a comparative market analysis that compares the home with at least three similar properties sold within five kilometres in the past six months. The agent can pass a copy to potential bidders only with the seller's written consent. The government's page for buyers likewise says an auctioneer may offer a comparative market analysis. That is a record of what other homes sold for, not a statement of what this one is expected to fetch.

The reserve itself stays private. The Office of Fair Trading's guidance says the amount of the reserve and the agent's estimate of the property's value must not be disclosed to bidders.

Private treaty has no equivalent ban in this guidance, which is addressed to auctions. A private treaty listing can carry an asking price. It does not have to: the wording of the required website statement, "sold by auction or without a price", recognises that some homes are marketed with no price at all. Either way, the figure in a private treaty sale that binds anyone is the one written into the contract, which the government's contract guidance describes as the price the buyer is offering.

Cooling-off: the widest gap between the two

A buyer under an ordinary residential contract in Queensland has time to reconsider. A buyer at auction does not.

The Queensland Government's cooling-off guidance sets the standard period at five business days. It starts on the day the buyer receives a copy of the contract signed by both parties, or on the next business day if that falls on a weekend or public holiday, and it ends at 5pm on the fifth business day. A buyer who wants to withdraw gives signed written notice to the seller or the seller's agent before that deadline. The seller must then refund the deposit within 14 days and may keep a penalty of up to 0.25 per cent of the purchase price.

As an illustration only, on a purchase price of $800,000 the maximum penalty would be $2,000, since 0.25 per cent of $800,000 is $2,000. The figures are illustrative and not drawn from any sale.

The same guidance says a buyer can give up this protection. The buyer may waive the cooling-off period, or shorten it to end at 5pm on a named date, by written notice to the seller or the seller's agent. So a private treaty buyer and seller who both want certainty quickly have a way to get it, but only if the buyer chooses to.

At auction there is nothing to waive. The government's page on buying at auction says there is no cooling-off period, and spells out what that means: a successful bidder has to settle the contract even if the house does not pass inspections, the buyer changes their mind or the buyer cannot afford it. The Office of Fair Trading lists sales by auction first among the contracts to which cooling-off does not apply. Its other listed exemptions include contracts formed by exercising an option, purchases by a publicly listed corporation or the State, and the purchase of at least three lots at once.

What happens when an auction does not produce a sale

The line between the two methods is least obvious in the days after a property is passed in. The home is no longer being auctioned, a negotiation begins, and the eventual contract looks like a private treaty sale. Whether the buyer gets a cooling-off period depends on who they are and how fast the deal is done.

The Queensland Government's guidance sets two tests. No cooling-off period applies if the contract is entered into within two business days of the unsuccessful auction and the buyer was a registered bidder at that auction. The Office of Fair Trading states the deadline as 5pm on the second business day.

One way to read the rule is that a registered bidder came to auction day prepared to buy without a cooling-off period, and is treated for two more business days as still being in the auction. A buyer who was not registered, or who comes to terms after that window, is treated as an ordinary private treaty buyer.

For a seller, this means the type of contract that follows a failed auction is not fixed in advance. The same home may be sold on auction terms on the Monday and on private treaty terms the following week.

Conditions: unconditional bids and conditional offers

A private treaty offer can be made to depend on something else happening. The Queensland Government's contract guidance gives the usual examples: the buyer obtaining finance approval, the property passing a building and pest inspection, or the buyer selling an existing home. The page adds a practical point. A condition only counts if it is written into the contract before signing, and it is the buyer who needs to see that it is there.

At auction the position is reversed. The government's page on buying at auction says the terms of sale usually require bids on an unconditional basis, which means no conditions such as subject to finance or subject to the completion of another sale. For that reason the page lists the checks a bidder is expected to finish beforehand: inspecting the property, arranging finance, getting a valuation, researching the market, reading the contract and taking legal advice on its terms. It also names a title search, building and pest inspections, a land tax clearance and, where there is one, a pool inspection.

The work a buyer does is much the same in both methods. The difference is when it has to be finished and who carries the risk if it is not. Under private treaty, a finance or inspection condition lets the buyer complete that work after signing, with the contract falling away if the condition is not met. At auction the same work comes before the bidding, at the buyer's cost, whether or not they end up as the successful bidder.

Contract and deposit timing

Under private treaty, the government's contract guidance says a contract becomes binding only when both the buyer and the seller have signed it. Until then either side can walk away. The contract states the price, when the deposit will be paid and the time and date of settlement. The deposit is typically due within two to three days of the contract becoming binding. A buyer may be asked for a partial deposit with an initial offer, and the page is plain that this does not secure the property: the seller can still decline, in which case the money is returned.

At auction there is no interval between agreement and contract. The government's guidance for bidders says the successful bidder must sign a contract immediately. The auctioneer announces the conditions of sale, and they include how much deposit will be asked for, expressed as a percentage of the winning bid. The Office of Fair Trading's guidance for auctioneers likewise lists the required deposit among the conditions of sale that have to be disclosed.

The seller is bound just as quickly. Once bidding reaches the reserve, the Office of Fair Trading says, the property is on the market and the seller must accept the highest bid. If no reserve was set in writing, the seller is obliged to accept the highest bid whatever it is, which is why the guidance requires the auctioneer to raise the question of a reserve beforehand.

In both methods the deposit is protected in the same way. The Office of Fair Trading's cooling-off guidance says deposits are held in a trust account and cannot be drawn on until settlement or until the contract is lawfully ended. The government's auction guidance warns that a successful bidder who does not settle faces very serious legal consequences, which can include paying the costs of a second auction and any shortfall in price.

Seller disclosure: the same documents, a different deadline

Since 1 August 2025 every Queensland seller has had a disclosure duty under the Property Law Act 2023. The Queensland Government's page on the seller disclosure scheme says the seller completes a disclosure statement, known as Form 2, and provides it with a set of prescribed certificates. Those include a title search and, where they apply, documents such as pool safety certificates and body corporate records.

The method of sale changes the deadline, not the content. For a private treaty sale, the page says the completed statement and certificates must be given to the buyer before the buyer signs the contract. For an auction, it says different rules apply, but the seller must still give or make available the statement and certificates to the buyer before the fall of the hammer. The documents can be sent by email or other electronic means, and the page suggests keeping proof that they were delivered.

The timing matters more at auction because of what was said above about cooling-off and conditions. A private treaty buyer who receives the documents shortly before signing still has five business days afterwards. A bidder has no such period, so the disclosure documents are part of the reading to be done before the auction.

The consequences of getting disclosure wrong are the same in both methods. According to the government's page, a buyer may be able to terminate at any time up to settlement if the documents were not given, or were inaccurate or incomplete on a material matter the buyer did not know about and that would have changed their decision. The page also sets out what the scheme does not cover: the statement is not required to address the structural soundness of the building, flooding history or previous building approvals. Those remain matters for a buyer's own enquiries under either method.

How each method appears in the statistics

Auctions lend themselves to weekly counting. Each one has a date and a result.

Cotality's published methodology explains how its weekly auction clearance rate is built. The rate covers auctions scheduled in the week ending Sunday. It compares the known number of properties sold before, at or after the auction with the total number of known auction results, and that total includes properties passed in and auctions withdrawn. Results are released as preliminary figures first, with final clearance rates published each Thursday. Cotality notes that not every result is known to it when the rate is calculated, and that a rate based on fewer than ten collected results should be treated as statistically unreliable.

Two consequences follow for anyone comparing the methods. First, a home that sells before its auction date is still counted as an auction sale in the clearance rate, even though the contract was negotiated privately. Second, a home marketed by private treaty from the start never enters the clearance rate at all. Its sale is recorded elsewhere, without a weekly pass or fail attached.

That makes the clearance rate a measure of one channel, not of the whole market. Its reach also changes as sellers move between methods. In its auction release of 10 August 2026, Cotality estimated that auctions accounted for about 40 per cent of new capital city listings in late March and about 26 per cent by the first week of August. When fewer sellers choose auction, the weekly rate describes a smaller share of what is for sale.

The clearance rate reports on homes whose owners chose auction. It is silent about every sale that began as a private negotiation.

What the differences add up to

Set against each other, the two methods distribute certainty differently. An auction fixes the date, removes the buyer's conditions and cooling-off, and binds both sides at the fall of the hammer. In exchange it withholds a price guide from buyers and asks them to complete their checks beforehand. Private treaty lets a price be shown and conditions be negotiated, gives the buyer five business days to reconsider, and leaves both parties free until two signatures are on the contract.

Neither set of rules is a loophole or a trap. Each is described in public guidance that buyers and sellers can read before they start, and the people who run sales under both methods work to the same disclosure scheme and the same trust account rules. Which method fits a given property depends on the home, the local market and the owner's own circumstances, and the Queensland Government's guidance notes that agents advise sellers on that question case by case.

Kooky, from Shaka

Kooky edits Queensland Estate and builds Shaka, the payment router he made for Queensland property professionals. One payment comes in, and every agent, agency and party in the deal receives their signed share on closing date.

About Kooky and Shaka →