Choosing the right method of sale is one of the most important aspects of a successful property sale. Each method of sale has its own merits but the goal is always the same: to achieve the highest sale price in the shortest possible time.
(A good agent will be able to give you advice on which method of sale is most appropriate for your property. You can compare real estate agents at LocalAgentFinder, including fees, commission, marketing strategy and more).
The three most popular methods of sale in Australia are private treaty, sale by tender and auction. Understanding which sales method is best for your property can help set your sale on the right tracks.
Selling by Private Treaty
Private treaty has been used for years to great success and remains the most popular sales method in Queensland and Australia. Selling by private treaty involves publicly listing and advertising a property at a set price, which is usually reflective of the current market value.
Prospective buyers make offers on the property and the vendor accepts, negotiates or declines the offers. A strong marketing campaign with multiple home opens, advertising and professional photography usually complements a private sales treaty; it’s important to show your property in its best light to potential buyers.
Reasons why some vendors choose to sell by private treaty:
- There is no pressure to accept an offer that doesn’t meet the vendor’s needs.
- The vendor receives multiple offers and then chooses the best one.
- Vendors have control over the length of time a property is listed for sale.
Selling By Tender
Growing in popularity, selling by tender basically works like a silent auction. The vendor receives secret offers from prospective buyers, who don’t know what other buyers are bidding, nor do they have access to a publicly listed price. The vendor chooses an end date when bidding closes and all offers must be presented to the vendor, who then chooses the best one.
This type of sale relies on a short-term but effective marketing campaign, and works best for properties that are in high-demand and offer something unique to distinguish them from competition. Your agent will be able to advise you whether or not tender is the right sale method for your property.
Reasons why some sellers choose for sale by tender:
- There is no publicly listed selling price, which means vendors are at an advantage when it comes to negotiations.
- Potential buyers often make offers higher than expected.
- The vendor has more control of the sale timeframe, and the price at which the property is sold.
- There is no obligation for the vendor to accept any of the tenders.
Selling By Auction
Auctions are becoming increasingly popular, not just in Victoria and New South Wales, but also in sunny Queensland. When used to the right effect auctions can achieve a great result in a short timeframe.
The sense of excitement and competition between buyers on auction day often means they outbid each other in order to secure the property and this can drive the price up to its highest possible market value.
However, auctions are not for every home sale as they are particularly effective in competitive markets where there is a lot of buyer interest.
Reasons why some sellers choose Auctions:
- There is not price ceiling at auctions, which allows potential buyers to offer more than expected in some cases.
- You are in control of the reserve price so you only accept offers that are suitable to you.
- If your property is sold on auction day, the sale immediately becomes unconditional, which means a smoother road to settlement
Choosing the right method of sale for your property can be daunting as there are many points to consider. Always make sure you consult with your real estate agent, who can recommend the method that will work best in your local property market.