Auction, tender or by negotiation? Find out the best way to sell your home.
An auction is an open negotiation to reach the true market value of your property at a particular time. As a seller, there are a lot of benefits including:
- The auction day deadline not only creates a sense of urgency for buyers but has the added advantage of giving you a defined timeline to plan around.
- By not setting an asking price that buyers may consider to be too high or too low, your property can attract a wider range of buyers.
- You can still consider any offers before auction day, in accordance with our Procedure for Pre-Auction Offers. Scott will register potential buyers so he can contact all interested parties in the event of a pre-auction offer.
- An auction creates competition, which can push buyers to really consider what their top price is. This may result in a higher than expected price when the hammer falls.
- Buyers must bid on an unconditional basis, so once the reserve is reached you can sign the paperwork and know the deal is done.
- Scott will give you regular market feedback and expert advice to help you set the reserve price.
When a property is sold by tender, buyers make confidential written offers by a set deadline. You may want to consider selling by tender if a number of people need to be consulted, such as if the property is a deceased estate or is owned by a family trust. It also works well if potential buyers will need to do due diligence before making an offer, for example, when the property has potential for development. Other benefits include:
- The deadline creates a sense of urgency for potential buyers.
- The tender process encourages buyers to make their best offer, which can lead to a premium price.
- You have up to five working days to decide which offer, if any, to accept. This can be helpful if a number of people are involved in making the decision.
- A tender gives you control in setting the terms and conditions of sale, like the possession date.
- By not stating an asking price that buyers may consider to be too high or too low, your property can attract a wider range of buyers.
- The result of a tender is private and confidential.
This popular method of sale is when you advertise your property with a price, price band or by negotiation. Prospective buyers make an offer and you can negotiate with them on price. The benefit of selling by negotiation is that both conditional and unconditional buyers are able to purchase your property.
Deadline Treaty/Deadline Sale
Sale by Deadline Treaty or Deadline Sale is definitely worthy of consideration. This is a lot like a Tender, where the agent sets a date and time in which all offers will be presented to the Vendor. Offers can be conditional or unconditional. The timeframe is somewhere between 7 to 20 days before the deadline closes. This often allows ample time for purchasers to do things such as getting their builders through, consulting with their lawyer, getting a LIM, sort their finance or even just get a family member to have a look
When the deadline comes around all offers are considered together by the vendor. The vendor is not committed to selling but the expectation, without commitment, is that the best offer will either be accepted or that negotiations will take place between the person or persons making the best offer or offers.
WHAT ARE THE ADVANTAGES OF DEADLINE SALES?
Deadline sales add an imperative to the process. They are saying put your best foot forward. You are not going to get the opportunity to go in low and hope to negotiate the vendor down. If you go in below your best price you could well be eliminated from the process at an early stage. The time deadline adds an element of urgency and encourages purchasers to minimise the conditions they require to improve the attractiveness of their offer. It can also encourage pre-deadline offers at the upper end of vendor’s expectations as the prospective purchaser tries to beat the market. In a competitive market this can work well for a vendor. After considering offers received, it is still open to the vendor to negotiate with one or more of the offering parties.