Right of first refusal
A right of first refusal lets certain people or entities acquire the property on the same terms as the buyer — which can cost you the acquisition even after winning the auction.
What it is, why it matters when bidding, and a worked example.
The law grants pre-emption in several situations: to a residential tenant of more than two years, to co-owners on the sale of a share, to owners of adjoining rural plots below a certain size, and to the municipality or the State for listed properties or protected zones. In judicial sales, holders are notified so they can exercise the right.
The practical effect is simple and unpleasant: the holder acquires on the terms established in the sale, meaning at the price the winning bidder offered. The bidder is left without the property, with the deposit returned, but also without the deal they prepared. The risk cannot be eliminated — it is mitigated by knowing before bidding whether an identifiable holder exists.
The signals are in the documents: a registered lease, an undivided share, a rural plot below the minimum cultivation unit, a heritage listing. None of them prevents the purchase; all of them justify confirming with the enforcement agent whether the pre-emption notices have been served and with what result.
Example
A 4,000 m² rural plot sells at €18,000. An adjoining owner, duly notified, exercises pre-emption and acquires at that same €18,000. The winning bidder recovers the deposit and loses the deal — with nothing irregular about the process. Checking for adjoining owners beforehand would have shown the size of the risk.
Frequently asked questions
Do I lose money if someone exercises pre-emption?
No. The deposit and any amounts paid are returned. You lose the deal and the time, not the capital.
How do I know whether a right of first refusal exists?
From the property's documents (registered leases, co-ownership, rural size and nature, heritage listing) and by asking the enforcement agent whether the pre-emption notices have been served.
Related terms
Go deeper
Encumbrances, occupancy, debts and missing paperwork: what to check before bidding.
Read the full guide