Methods of Sale and How We Can Help You
The Melbourne property market has been built on the auction system. Historically, estates were originally sold and, like the Melbourne Cup and the AFL Grand Final, auctions have become part of our cultural fabric.
Tried and tested, auctions can provide a transparent method of sale where buyers can see their competition, vendors can see what buyers are prepared to pay and all takes place in a dedicated time frame.
There are, however, more methods than just auction sales and here we look at a variety of different methods to sell property.
We say ‘sell property’ because, as a buyer, it’s hard enough to find the right house, let alone select your preferred method of sale. It’s therefore better to know how to navigate all methods of sale so you can maximise your chances of buying the right house when you find it.
Methods of Sale of Property
These are usually marketed over a three-week campaign, consisting of four Saturdays with the auction being held on the final Saturday.
Some of the questions we can help you with include:
- How does this relate to the vendor’s reserve?
- Where are the other buyers’ expectations?
- How do you negotiate a pass?
- Who is protecting your interests (the vendor has an agent negotiating for them)?
- Why did it pass in?
- Should you meet the reserve?
- Can the property be bought beforehand?
- Why is the vendor selling beforehand?
- Are you the only buyer?
- What if there are other buyers?
- Is your offer much higher than other buyers?
- What happens if the offer is not accepted?
- What are the right questions to ask?
- Are you revealing information about yourself?
- Who should you be talking to?
- Should you do a building inspection?
Expression of Interest Sales
This method of sale is perhaps the least preferred method for buyers.
It is a private sale with an end date. Sometimes properties are sold before the closing date, sometimes on and sometimes after, or not at all.
Sometimes this method of sale is chosen because the vendor has very high expectations, well above sales results for similar homes. It is also a way for an agent to ‘protect’ a vendor reserve.
Some properties are sold this way as they are likely to appeal to a smaller buyer group and it is harder for buyers to know if they are the only interested party or one of many.
Each agency, and sometimes agents within the agency, make up their own rules and they can change during the process.
- How do you find out the rules?
- What should you do if the rules change?
- How do you know if you are the only buyer?
- What should you do if there are multiple buyers?
- What is the right price?
- Is the quote real?
- How much does the vendor really want?
Off Market and Private Sales
Off market is really the new way of saying Private Sale.
If you are receiving information via a marketing text or email, it is really a private sale. The agent usually has an authority to sell these properties.
In the ‘olden days’, a private sale was a property for sale with an asking price. If the price was paid, then the property was likely to be sold.
If an offer was lower, a negotiation often took place. There was still an element of confusion, particularly if there was more than one party interested in the property but usually price wasn’t the confusing component.
These days, however, many agents dance around the asking price and try to run a confused campaign with no real price, no plan and sometimes no real seller.
This can be very common with a true ‘off market’ property. We identify this as a property that is very quietly for sale. It has not been part of a mass text/email campaign and the agent sometimes doesn’t have an authority to sell it. Depending on the agent trying to sell the home, they can be very confusing for buyers.
Over 30% of the homes we buy are ‘off market’. However, more than half of the homes we purchase off market are purchased time and again from the same agents. Why? Because many agents are skilled at off markets, ie they specialise in quiet transactions. They have good communication skills with their vendors in the absence of social proof and know how to work together to achieve the desired result.
Knowing who these agents are could save you a lot of time looking at homes that may not even really be for sale.
- Are you working with the right agent?
- Is the home really for sale?
- Is the vendor commercial or opportunistic?
- Is it a good home?
- Why isn’t it being sold publicly?
- What is the right price?
At WoledgeHatt we know the right questions to ask the agents and we know how to answer our questions above.
Since 2007, we have been buying homes via all these methods of sale and in all different types of markets. We specialise in residential homes, so contact us today and let us help you increase your chance for success when buying your next home.