I want to sell, but the options are confusing which is best?
There are so many things to consider when it comes to selling your property that choosing a method of sale can feel overwhelming. You want to be sure you're going to get the best possible result. Here is an overview of the methods of sale available and the reasons they may work best for you.
Here at Harcourts we are firm believers Auctions are the best method of sale in any market environment, for several reasons:
- Auctions get maximum exposure for your property in a short period of time with a structured, intensive marketing campaign over a few weeks which is convenient but also creates a sense of urgency for buyers.
- Rather than potentially placing a ceiling on what people will pay for a property, auctions allow buyers to decide what a property is worth, meaning you can be secure knowing you are getting an accurate market value. Properties listed with a price are typically negotiated and sell at a lower price point, Auction is a process designed to bring prices up.
- Creating fair competition for your home can push buyers to truly consider their top price come auction day, and may result in you getting more than expected when the hammer finally comes down.
- An auction sale is an unconditional sale, meaning you can sign the paperwork on auction day, a deposit is paid and you have certainty.
- If your home doesn’t sell at auction, the intense interest and buyer activity generated in the lead-up to the auction means you usually have an increased chance of selling the home in a multi offer or at a negotiated price to interested parties within a short period after the Auction. Your real estate agent will already know who is genuinely interested in the property and can deal direct with them to see if an agreement can be reached.
- Auctions are fair to all parties both buyers and sellers are able to see exactly what is happening at the time, there is none of the “smoke and mirrors” associated with some of the other methods of sale, this appeals to all parties involved.
An auction campaign also allows for potential buyers to make pre-auction offers. If you wish to accept a pre-auction offer your Harcourts sales consultant would generally recommend you bring the auction forward, and will notify any other interested parties. The pre-auction offer will then become the opening bid.
In our opinion Auctions typically produce the best chance of achieving a sale for an owner. From our Harcourts Auction statistics ( at time of writing) a property that has been listed as an Auction has an over 80% chance of sale either pre auction, on the day, or post auction during the remainder of the listing period.
All other methods of sale combined have a 60% chance of achieving a sale during there initial 90 day listing period.
This method of marketing creates a high profile for your property and establishes a competitive environment without having to list a price. You also set the terms, conditions and deadline date and you will find prospective buyers become emotionally involved with your home before they consider the price they have to pay. They only have one opportunity to put forward their most competitive offer. You have the opportunity to accept, decline or continue negotiations with any interested party - it’s your choice. You’re in control of the process. Increased enquiries and inspections are often generated by this sales method however that could be because it is a method favoured more for properties closer to the mid to lower price ranges.
Price by Negotiation (PBN)
This method of sale can be applied in the following way.
1.No price is advertised. Buyers make offers through the sales consultants.
The benefit of PBN is the level of market interest will help the seller gauge a fair sale price. The “no price” aspect will also attract more genuinely interested, cash-in-hand buyers. By contrast, unlike auction and tender there is no sale date or deadline in place so there is no urgency placed on buyers to make a buying decision. This method can sometimes cause frustration with buyers as they will typically ask “Well what price do they want then?”
This means that a property is listed with a definite price. If the property is priced correctly it will attract good interest, and in some cases have multiple offers resulting in a premium sale price. The fixed price also gives the buyer a price guideline and allows for a property search by price on real estate websites.
However, it is easy to over- or under-price the property. With an overpriced property buyers may discount the property without inspecting it, judging it solely on the price vs the photos or look of the home. This can effectively limit the market for that particular property.
With an under-priced property typically it will be sold quickly to one of the first people to see the property.
Which option is best?
That is the $64,000 question, personally we prefer Auctions for the reasons stated. But we appreciate that there is an associated extra cost with this method. Like anything there are auctions and there are Auctions, if this is an option you favour then I suggest you talk to Us, we are the acknowledged experts in this method.