The method you choose to sell your property is one of the major determining factors on your outcome. There is plenty of talk about how you should sell, but do you really know how each method works for you?
Here’s a quick rundown on each method.
An auction is a great way to sell your property. The process alone draws out interested parties and brings things to a head. It doesn’t necessarily mean that you will have it sold on the day of the auction, though campaigns well executed and marketed have seen stellar results achieved. It puts a time limit on when potential buyers need to have everything prepared by and also calls for an unconditional sale on the day, without any cooling off. The same conditions apply 3 business days before and after the auction day. So a rookie mistake would be to sign an offer on the Tuesday before auction and have to wait until Friday for cooling off. My only problem with an auction is that it always goes to the next best bidder, to me this may not be the highest or best price that is achievable from the buyer. If that buyer has an extra $20k and their contender runs out of steam before they hit their total budget. Then technically there’s still $20k left on the table. It’s irrelevant if you’re over your reserve and happy with the price, it never sits well with me to know that they buyer only competes against other buyers and not themselves. Either way I love the auction process and have secured amazing results over time.
Otherwise known as a private sale, has always been a preference for a lot of owners. They feel there is less pressure with this method and feel more comfortable. Some people dislike auctions and prefer private treaty, just because they feel too much pressure when they’re trying to buy. So, here’s something to remember. You’re now the seller and you have to do the best thing for yourself. A private treaty has its place and is great if a seller would like to search a market at a higher price and have an extended sales campaign. The major things to keep in consideration is that there is no sense of urgency for the buyers to react in most cases, it also invites clauses such as subject to finance, or building and pest inspections and a whole range of things that buyers ask for. This means that even after you have secure the right price and settlement terms, there are still possibilities of the deal to fall over. I’m not anti-private treaty, the majority of my sales in my career have been via this method. I just feel that I have had better results when I have a time constraint of sorts. Which leads on to the final method.
Expressions of interest
This is a hybrid of an auction and a private treaty. It has a less pressured feel than an auction and allows you to put your best foot forward with price, terms and conditions by a certain date. Unfortunately, the end result still attracts 3 clear business days for cooling off, which is why a Tuesday is a good day to call all offers. I personally believe that even though this method has its flaws with conditions and cooling off, it is still the best way to get the best price. In almost all cases there is a discrepancy between the winning offer and the under bidder. What I’ve found is a consistency of around $30K for mid million dollar properties though I’ve seen over $100K difference in my time selling.
You should work with your comfortabilities, though if you’re open to be guided by your agent, I think you’ll have a happier outcome in the end.