To sell by Auction,
Private Treaty or Tender?
How should you sell your house?
3 main methods for selling your house. Auction, Private Treaty & Tender.
Every house is unique – different houses and different areas perform differently, depending on the method of sale.
For you to achieve the highest sales price, it is important to talk to your real estate agent and make sure you do your research. Please note – that the rules and regulations will vary in different states and territories.
Selling by auction means you are effectively setting a minimum price you will accept for your home.
Setting an auction date creates a sense of urgency and a fear of missing out. Many auctions have a 4 week marketing campaign. This sense of urgency helps create a lot of buyer interest in a short amount of time.
One benefit of selling by auction is that there is no price limit. There is a minimum or reserve amount set In some states, not all. Buyers can be given a price guide which may vary depending on the amount of interest in the property. Note: This is illegal is some states.
Selling your house by private treaty. Also known as private sale, involves marketing your home for sale at a specified price.
Buyers can get a clear indication of the price you want for your house, and this helps start the negotiation process.
As there is no official selling date, as with auctions, selling your home by private treaty may sometimes be slower. Private sale contracts have a 5 business day cooling off period. This will vary from state to state. Selling by private treaty allows you to negotiate the price and terms of the contract.
After a price has been negotiated and agreed on, the sale may still be subject to conditions. For example, building and pest inspections, or may also require finance approval.
Selling your house by tender, all known as expression of interest. is when you invite potential buyers to submit an offer to purchase your property.
Potential buyers submit in writing, their best and final offer. This need to be submitted by a specified date. Potential buyers need to submit more than just the price they are willing to pay. They also need to include proposed settlement date, finance conditions, and any other conditions, such as subject to building and pest inspections.
In this way, selling by tender is similar to an auction, providing a sense of urgency & generating competition. But without the stress that can come with auctions.
At the end of then tender period, you can then review the submissions and choose the tender that suits you best. If you don’t receive an acceptable offer, you can then put the property back on the market.