In Australia, there are normally two main methods of selling your property.
Either private treaty (normal sale) or Auction.
Below is a summary of the advantages and disadvantages of each method.
This is the standard way of selling your property and is called private treaty. It is where you and your agent discuss what you want to set the price of your house for and then have the agent negotiate with prospective buyers on your behalf.
- Greater flexibility during negotiations.
- Flexibility regarding the length of the time that your property is on the market for.
- Cost savings on the marketing and promotional expenses.
- The property may take longer to sell compared to other methods (such as auction).
- You may have to make your home available for spontaneous viewings by potential buyers.
- The dangers of mispricing the property, such as over pricing and having the house empty for weeks or under pricing and selling the house for too little.
An auction is when a group of potential buyers come together on a day to bid on your property. The highest bidder then becomes the successful buyer if the highest bid matches or exceeds the reserve price.
- Three chances to market the property, before the auction, during the auction and in the unfortunate case where the property falls through, after the auction.
- You have the ability to set a reserve price on the property.
- Organised viewings of the property on days that have been agreed with the vendor to minimally disrupt their day.
- The auction process in it self creates a sense of urgency for the buyers so they have a time frame to act within.
- Auctions promote strong competitive bidding and reflects the true value of the house.
- Marketing a property through auction is generally more expensive compared to private treaties.
- Pressure may be put on the vendor to reduce the reserve price during an auction.
- Auctions are not for private people who are uncomfortable about having their home shown publicly.
As above both methods of selling your property have advantages. Either way, if your property is sold through a FlatComm agent then there are no upfront fees. This is particularly attractive especially in regards to auction campaigns where agents can and do charge substantial fees upfront.