Selling your home by auction offers a lot of advantages and it can be a great opportunity to get a premium price for your property. This is because when you are auctioning a house, it creates a sense of urgency and gets buyers competing against each other. The higher the buyers bid, the more you get for your home. We serve up nine good reasons to consider selling your home at auction.
1. The buyer must commit
When a buyer raises their hand to bid at the auction, they are making an unconditional cash offer for your property. This means that they are committed and they cannot change their mind later. The successful bidder has to sign the contract and pay the deposit at the time of the sale. There is no cooling off period. If the buyer can’t complete the contract, they will have to forfeit the deposit amount.
2. The sale terms are up to you
When it comes to selling your house at auction, the ball is in your court. The terms and conditions of sale will be completely controlled by you. You can decide on the settlement date, the level of deposit, the auction date ... you can even choose to accept a pre-auction offer (a specific clause must be included in all marketing). It’s your call!
3. Auctions have been tried and tested over many centuries
The tradition of holding auctions dates back to 500 BC in ancient Greece. Unfortunately, in those auctions it was women who were being auctioned off as wives. However, when the items being auctioned off are houses, the process has proven effective at establishing a property's true market worth.
4. Selling your home at auction has a high success rate
Recent statistics show just how successful auctions are. Not only is the success rate higher than other methods of sale, auctions generally result in a sale more quickly. With high auction clearance rates like these, it would be wrong not to consider selling your home at an auction.
5. Buyers don't prejudge your property
When selling your home at auction, you don’t have to advertise an asking price or a price range. This is great for attracting a larger pool of potential buyers to open homes, because there is no risk of them prejudging the property based on the advertised price.
6. Auctions offer price protection
You can set a reserve price, which is the minimum price at which you would like to sell the property. If the auction bids do not reach this minimum price, you do not have to sell.
7. There is a deadline
Good real estate agents will put in place an effective marketing campaign to lure the right buyers within a short span of time. Your property won’t be on the market for an extended period. This makes for a very competitive environment, which puts pressure on potential buyers to act fast. They will not be able to procrastinate and waste time attempting to negotiate the sale terms.
8. Competition raises your prices
In an auction when there are two or more interested buyers bidding on your property, they will generally keep bidding higher and higher; forcing them to put their absolute best offer forward if they want to secure the property.
9. Auctions offer more than one opportunity to sell
Another advantage of auctions is that they give you three distinct opportunities to sell. The first is before the auction (a specific clause must be included in all marketing), the second is during the auction when buyers are bidding, and the third option presents itseld if the property does not meet the reserve and negotiation continues with motivated buyers.
If you are selling, or thinking of selling your house, then download our handy checklist to help you through this journey.
