Market conditions remain challenging and whilst recent improvements are encouraging, the average time on market for a home in and around Fremantle remains above the long-term average. Those who need to sell and sell quickly, often opt for an auction given reported statistics for days on market for such campaigns is 28 days.
I’m an advocate for the auction process as a method of sale for a number of reasons. It’s the most transparent selling process with all buyers able to see their competing buyer and the auctioneer bound by an ethical REIWA code of conduct that brings fairness to the process. Buyers also usually have time (unless the seller accepts an offer prior to auction) to view the property several times, undertake all necessary diligence and be ready to buy on auction day.
The benefits to sellers include a cash, unconditional contract, a settlement period that suits their needs, a healthy deposit and the delivery of what is the very definition of fair market value. The “no price” marketing strategy in the lead up to the auction day is also beneficial as it captures all possible buyers, including those that may not otherwise of considered the property if on the market at a fixed price by private treaty.
In short, the auction process “shakes the buyer tree” and reveals all possible buyers. And if the property is being sold under an executorship arrangement, or the market price is difficult to determine, then auction is the most appropriate method.
However, offering a property to market via the auction process each and every time for each and every property is not essential.
Sellers often feel under pressure from their agents to “meet the market” on the day of auction even if the highest bid is below their original reserve price. The lead up to the auction day can be stressful too with multiple home opens and inspections during the weeks prior.
Some buyers remain deterred by the auction process too; either too nervous to bid or unprepared to buy without certain conditions such as finance approval for example.
In the event the property is passed in or no bids are received, the sellers’ disappointment is palpable with all the seller benefits of the auction process partially handed to the buyers who now feel empowered to offer below market price, confident they have no competition.
When selling be sure to ask your agent about all the options when coming to market as there’s benefits with all methods of sale. It’s a matter of choosing one that suits your needs and circumstances and agents should offer you that choice.
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