If you want to sell a property you own, one of the first big decisions to make is which sale method you’ll use: auction or private sale. It’s important to speak to your trusted real estate agent so you can understand the difference between private sale vs auction to determine what sales method is right for you.
Selling by private sale means a property is advertised and the potential buyers will make offers to the seller or their real estate agent. You will set an asking price (estimated within 10%), and the property is listed for sale at that price. The property can also be listed as a price range or call for offers over a certain price (as disclosed in the agency agreement) or even an expression of interest without a requirement to disclose this price to potential buyers.
There are numerous advantages associated with selling property using this private sale method.
- Once an asking price has been advertised in marketing materials, this takes away the potential for further price estimation. This helps attract homebuyers who are looking for a property in a specific price bracket.
- Sellers have the option to either set a specific deadline or leave the sale date open. With no deadline, buyers feel less pressure to act immediately. This can be attractive to purchasers.
- Advertising the sale price creates a more open selling process. Buyers who may not appreciate the more competitive auction sales process may be encouraged to submit an offer.
An auction is a gathering of potential buyers who publicly bid for a property. As the seller, you and your agent set a reserve price. It is important that you are comfortable with this price as this is the lowest price you will accept for your property. An auction can be the right option when you are in need of a hasty sale – whether you need to sell your property by a certain date or have already purchased your next home. It can also be a good option if your property is unique and not easily valued, or if you are in a sought-after location. Auctions are also beneficial in hot property markets where demand is strong.
Advantages of Selling a property in Auction:
- People bidding are buying with terms and conditions determined by you as the vendor.
- You as the vendor are protected by the reserve price. You have the opportunity to set the reserve together with the real estate agent after assessing the bidding strength of the potential purchasers. This is determined in part by information collated during the open-house inspections.
- You get to control how much is spent on the marketing plan by choosing how much the auction is advertised to the public.
- If the property doesn’t sell at the auction, you’ll be put in direct contact with the most likely buyer and can enter further negotiations.
Decide the right method of sale
The best-suited method of sale will depend on your property, your property location, and the skills of your real estate agent. They’ll help you understand whether or not auctioning your home is suitable in current market conditions.
If you are looking to put up for sale your residential property or home, National Brokers Network has a free residential property listing. Contact National Brokers Network now, they’re ready to assist and serve you!