Selling Options: The Pros and Cons

The information in this article is courtesy of Realestateweb (Selling your property – 21 May 2009)

When it comes to selling property, you have a few options. Most people opt for using an estate agent, other sell by private tender and some go to auction to get their property off the market. Here are the pros and cons of these options:

Sale by private tender incorporates the best selling methods of estate agents and auctions. Your property will also have a limited time in which it will be sold. The process of selling by private tender is not transparent, which means that buyers are forced to put their best offer forward as they do not know who has offered what.

A disadvantage of selling by private tender is that buyers have a short time in which they have to make a decision, as there are limited viewing days. Also, sellers might not accept any of the offers and buyers never know what price they are bidding against, leaving them no choice but to put in their maximum bid.

Using an estate agent to sell your property means you get a personal service. Safety is also guaranteed as the agent will screen and pre-qualify potential buyers to view property. Also, you can benefit from estate agents’ knowledge of legal terms and the property market.

However, estate agents charges a commission and advertising and marketing your property might be expensive. Another disadvantage of using an estate agent to sell your property is that not all agents have the incentive to get the highest price for the property.

When you sell your property on auction, you are assured that the buyer will take care of the commission as well as all the other costs of the transaction. The deal is transparent since auctions are live and bidders know at every stage what the highest bid is. The purchase of a property on auctions is also not subject to bond approvals.

A disadvantage of selling on auction is that buyers are often scared of bidding, because they are not familiar with the process. Also, there is often an oversupply of stock meaning sellers can often miss out on an opportunity to sell. Another downside is that in some cases, sellers are responsible for advertising costs.