If you’re thinking that this might be the time you’d like to sell your house, or are thinking of selling your house in the near future, then keep reading. We interviewed Real Estate Agent Vicky Webster from Tall Poppy to find out the different ways to sell your house and which ways may be most effective for your situation so that you can make an informed decision on how to sell your home.
Watch instead: What options do I have when it comes to selling my house?
What options do I have when it comes to selling my house?
There are several different options to choose from when it comes to selling a house; your Real Estate Agent will be able to talk you through the different options and the risks involved with each method of sale. Your lawyer will be able to mitigate some of these risks by adding different conditions to the SOP (sale and purchase agreement).
The first thing you may want to do is to pull some data on similar houses in your area that have sold recently to get a better idea of price, as well as getting your house appraised, which most Real Estate Agents can help you with. Have a think about how much you’d like to get for your house with a basic going to market price. This is where you state the price you’re wanting for your house so buyers know what their budget is, and where you’re expecting it to be; however some methods of sale do not require this such as auctions and tenders where there’s no price given. So let’s get into the different methods of sale.
Auctions
Auctions can be quite scary for people. As lots of people don’t understand the process. In some markets and in some houses, an auction is a great way to sell your house.
Costs:
The associated costs that you have to think about are that your lawyer needs to draw up your auction paperwork and you also have to pay for an auctioneer’s fee. So there are a couple of little hidden costs in there.
Pros:
- They are open, so anyone can bid at an auction; which means you get the best of everyone out there, which, usually, are unconditional offers.
- If you’re looking for something to be sold relatively quickly, the offers will be unconditional so it’s a quick turnaround time
- Once the hammer drops, you know you’re sold
Cons:
- If you’re wanting the highest price for your house instead of the quickest turnaround time, auctions may not be for you as auctions aren’t surefire; they’re a gamble. In an auction the bidding will stop when the last person bids and you never know the upper end of the prospective buyers’ budget is and where they’ll draw the line.
- If you’re down to one or two bidders and someone pulls out and the person that puts in their final bid, they might sort of say, well, actually I was prepared to pay $50k to $100k more for that property, but if they’ve got no one to bid against, they’ll get it for a bargain.
Tenders
Tenders are another way to attract unconditional offers. You can also put in a conditional offer on a tender there. There’s no price guide given on a tender, so buyers have to do their homework to decide what they feel your house is worth. Tenders are normally closed and opened by the agent with the clients at the end of the tender unless they have been sold prior where they can look at them, but normally you run the tender right through to the end to see what offers you get.
Pros:
- Tenders can be a good way of getting the top offer out of someone as they’re unsure what other buyers are putting in.
- You don’t have to accept any tenders if there’s nothing there you like.
- You can choose to go with either a conditional or unconditional offer if various vendors out both types of offers in and you can negotiate if there’s something not quite right about the offer.
- If you’re pressed for time, a tender runs for a short time period, which acts in your favour as you know that those putting offers in are serious about buying.
Cons:
- Unlike an auction, a tender allows room for negotiations from the buyer’s side.
Deadline Sale
A deadline sale runs along a similar line as a tender. It’s run for a short period and again, people encouraged to put their offers in.
Pros:
- Offers can be conditional, which is great for first time buyers or for people who for whatever reason can’t give a cash offer.
- As a vendor, you have the choice to either accept one of those offers or negotiate with one.
Cons:
- You might get offers for the price you want, but not with the conditions you want. Sometimes the ideal offer you’re wanting to accept is subject to another house for sale etc.
- An offer might be subject to a whole raft of conditions and any one of those conditions can fall over and you lose the sale, like their financials.
TOP TIP #1
If you’re thinking “Oh I just want the top price and I want to sell my house for the most money,” you actually have to just take a breath and look at all the offers that are put in front of you and have a think at what offer is going to suit you and your situation best.
It may be that you decide for $10,000 less an offer that’s only got three days to sort finance, insurance and the builders report might actually be better than an offer that’s $10,000 more with a whole raft of conditions.
TOP TIP #2
Your agent can help you with the decision if you’re still unsure. Remember that no question is a silly question and they’ll be able to guide you through the process from start to finish and assess what the best options are for you based on your goals and current/future desired position.
BEO (Buyer Enquiry Over)
If you put a price on a property, you must give serious consideration to an offer that comes in at that price or above. You don’t have to accept it, but if let’s say we put a $550,000 buyer inquiry on a property and brought you an offer of $549,548 and you said, “oh actually I want $580,000” then that becomes bait advertising so we would then have to change that advertising to say that the buyer inquiry is now $580,000 or over.
Pros:
- You’ll most likely get serious bidders who put in offers very close to what you want
- If bids meet or are close to meeting the BEO price, then you must give serious consideration to those bids unlike a tender.
- If you’re a buyer, it gives you a good idea of whether or not a house is in your budget .
Cons:
- Some offers are heavily conditional, causing the sale process to drag on for a while to ensure all conditions are met
If you’re wondering “I actually live in Upper Hutt and I’d love to talk to Vicky to see if she’d be the right person to sell my home or give me an appraisal” you can contact Vicky Webster on 027 728 8997, or email her at Vicky.Webster@tallpoppy.co.nz
Want to know more about Vicky from Tall Poppy? You can find her website bio here.
