By Rothschild Group (Settlements) Team | Perth, Western Australia
A fall in market value after a WA property offer is accepted does not usually give the buyer an automatic right to cancel. The contract is for an agreed price, not a promise that the property's value will remain unchanged. A buyer may only terminate or avoid settlement if the contract, legislation or another legal principle provides a valid basis.Key takeaways
- A change in market value alone is generally not a contractual exit.
- A low bank valuation may affect finance approval, but the result depends on the exact finance condition.
- Inspection, due-diligence and subject-to-sale conditions only operate within their wording and deadlines.
- A buyer should not assume that withdrawing a loan application or failing to cooperate will validly end the contract.
- Obtain urgent legal advice before sending a termination notice or refusing settlement.
When does a WA property contract become binding?
Most private sales use an Offer and Acceptance form together with the Joint Form of General Conditions. Consumer Protection WA explains that the seller may reject, counter or accept a written offer. When the parties agree and acceptance is communicated, the contract is generally binding. Western Australia does not provide a general mandatory cooling-off period for an ordinary private property sale. A buyer therefore cannot usually change their mind simply because another property is cheaper, the market has softened or a later valuation is lower.Does a lower bank valuation cancel the contract?
No, not by itself. A valuation is commonly part of the lender's assessment of the property as security. If the bank values the property below the contract price, it may lend less, request a larger deposit or decline the loan. The contractual effect depends on the finance condition. Relevant questions include:- Is the contract actually subject to finance?
- Is a lender, loan amount or approval date specified?
- Has approval been obtained, and is it subject to a satisfactory valuation?
- What efforts must the buyer make to obtain finance?
- What notice and evidence must be given if finance is refused?
Can the buyer rely on a finance condition?
Possibly, where genuine finance is refused and the contract's requirements have been met. Check the required loan amount, any nominated lender, approval deadline and all other finance terms. Consumer Protection explains that buyers must comply with the finance clause and its notice requirements. Buyers must understand any conditions attached to a lender's approval. A contract does not necessarily become void automatically when a finance date passes. The rights of each party and any notice procedure depend on the wording. A buyer should promptly provide the contract and lender correspondence to a solicitor or settlement professional rather than relying on a verbal statement that finance “did not work out”. Deliberately failing to cooperate with the lender, cancelling an application or withholding requested documents may breach obligations to take reasonable or genuine steps. Never manufacture a finance refusal to escape an unfavourable bargain.What if the contract has another condition?
A building inspection, pest inspection, due-diligence, subject-to-sale or other special condition may create rights in defined circumstances. Those rights are not interchangeable. For example, a structural inspection condition does not ordinarily let a buyer cancel because the market price fell. Read the trigger, deadline, required report, notice procedure and remedy. Some conditions allow a party to request rectification or renegotiate before termination becomes available. Others are satisfied or waived if action is not taken in time.Can the buyer renegotiate the price?
The buyer may ask, but the seller generally does not have to agree. If the parties voluntarily change the price or another term, the variation should be properly documented and signed. Inform the lender and settlement agent because duty, loan and settlement figures may need to change. Do not treat informal text messages as a completed variation. A failed renegotiation does not itself cancel the original contract.Are there legal rights outside the contract?
There can be, depending on the facts. Possible issues may include misleading conduct, misrepresentation, statutory disclosure failures, title problems, incapacity, mistake or repudiation. Off-the-plan strata transactions also have specific disclosure and registration rules. These are legal questions requiring individual advice and evidence. A market fall is not the same as a seller misleading the buyer, and disappointment about the price is not proof of a statutory breach.What happens if the buyer simply refuses to settle?
A party who does not complete a binding contract may be in default. Depending on the contract and circumstances, consequences can include default interest, notices, loss of deposit, termination, resale loss and legal costs. The seller may also seek other remedies. The buyer should not ignore settlement notices while exploring options. Contact the settlement agent, lender and an independent solicitor immediately. Preserve valuation reports, emails, loan records and the complete signed contract.Frequently asked questions
Can I cancel because the suburb's prices have fallen?
Usually not. Market movement alone is generally a commercial risk rather than a contractual termination right.What if the bank will not lend enough?
The answer depends on the finance condition and lender evidence. Obtain advice before the approval date or any notice deadline.Can a seller cancel because the property is now worth more?
Not merely because the market rose. A binding seller is also required to perform the contract unless a valid right arises.Can Rothschild Group (Settlements) decide whether I can terminate?
We can identify settlement issues and coordinate the transaction. A disputed or uncertain termination should be addressed by a solicitor giving legal advice on the contract.Act before the deadline
If a valuation or market change creates concern, do not wait until settlement day. Early review may identify a finance, notice or negotiation pathway while relevant dates are still open. Contact Rothschild Group (Settlements) immediately about the settlement timetable and obtain independent legal advice before issuing any notice. Learn more about our buyer settlement service. This article is general information only and not legal or financial advice. Rights depend on the complete contract, legislation, notices and facts.Source review completed 9 November 2026.
Authoritative sources
- Consumer Protection WA - Offer and acceptance contracts
- Consumer Protection WA - Sale by offer and acceptance guide
- Consumer Protection WA - Buying property off the plan
- Consumer Protection WA - Property settlement
About Rothschild Group (Settlements)
Rothschild Group (Settlements) assists buyers and sellers with property settlement and conveyancing in Perth and Western Australia. Meet our team or request a settlement quote.