There are several ways to sell a property but the way you sell your property depends on your personal circumstances and often the type of property.
Some properties sell better at auctions, while others have achieved great prices through private sales. If you want to sell your property quickly, you may consider asking your agent if they have a database of buyers interested in your types of property, and consider making an off market sale.
Here are some of the ways you can sell your property, together with some of the pros and cons of each method of sale:
This is probably the most common way a property is sold. The property is advertised with a fixed price, a price range or to contact the agent and interested buyers can make an offer. When a buyer is interested, they will often negotiate with the seller on a price and conditions may be written into a contract of sale, such as subject to a building inspection report or obtaining finance.
Pros: The flexibility for negotiation on the terms of the contract can work well for both seller and buyer – such as a reduction in price for a quick sale.
Con: None we can think of!
This is probably the second most common way a property sells, and while there are some very strict rules to be adhered to, a property selling at auction can be a very exciting event. Anyone can attend this type of auction, whether attendees are interested in buying or not.
It is usually conducted by a real estate agent, and once the date, time and place of the auction are decided, there’s usually a marketing campaign. At the auction itself, after the reserve price (ie the lowest price the vendors are prepared to accept) is reached, the auctioneer will announce the property is ‘selling’ or ‘on the market’. The highest bid is called three times, before the hammer comes down.
Pro: A very transparent way of selling. Buyers can immediately see their competition and for vendors, they will hopefully get a quick sale.
Con: Buying at auction isn’t for everyone as there are rules and regulations, such as no cooling off period and pest and building reports are required to be done before auction. Because of this, there is a risk the vendor may lose some potential buyers.
Expression of interest/Tender/By register
This type of sale generally works by serious buyers making an offer by a specific time and date. In their final offer, they include their terms and conditions such as settlement dates and finance. The buyer and seller may reach an agreement before the specified date, but if no acceptable offers are received, the sellers have the option of putting it onto the market for private sale.
Pro: While there may be conditions attached to the final offer, if you are selling your property, you have a selection of final offers to choose from.
Con: For buyers, they don’t really know the vendor price expectations or what the competition is.
Good real estate agents have a database of buyers interested in particular types of property and if the vendor wants, the property will be shown to these people first. It is in effect a private sale as the vendor and buyers will still negotiate on the price and conditions through the agent.
Pro: There are usually fewer open inspections and it’s a quick sale. The vendor also avoids marketing costs.
Con: There is a risk the property may not sell at the best possible price because it hasn’t gone to the open market.
While you may prefer to sell your property yourself, a good real estate agent will talk you through your sale method options, clearly explaining in plain English the pros and cons of each method of sale, and why a particular sale method will work best for your property.
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