Not a Auction Campaign!
Well you have now decided to sell the family home after months of deliberating, the family home is now going to be sold for what ever the reasons may be. We now have to choose a respected real estate agent who sells property in our area, there are a couple that come to mind, so you phone both of them for their professional market opinions. After both real estate agents have inspected the home, they have both come up with similar values but have both recommended a Auction Sale Campaign.
It is understandable that for many families this may terrify them, just the thought of an Auction sends chills down their spine. Step back for a moment and reach for some fresh air, we need to ask ourselves why have they both recommended this method of sale, is there something happening that we are not aware of, the market may be very competitive in this area, or do both of these real estate agents simply use this method for all properties. Firstly, now that you have been provided with two appraisals from agents that specialise in the area, you will now know which agent you prefer, chances are that you knew before but you just needed some more clarification with the presentations to justify your decision.
When you have the next meeting with the agent you have chosen, don’t be afraid to ask questions or even think that this may be a silly question. Your first question should be, Why have you chosen a Auction Campaign? stop and listen carefully. The reasoning may make total sense or you may still be totally confused and scared. In the event that the agent has explained the auction process and you are now satisfied, well all will be good. In the event that you are not satisfied with the explanation, ask the agent what are the advantages and disadvantages with the auction process and how will this effect the sale and price of the home, will the auction take place on site or amongst a group of other properties at another location. This is when a true professional should shine after some initial resistance, and it is at this point they either get it right and you totally agree or you don’t.
If you don’t agree with the agent, chances are you will then revert to a normal sale process, which is also known as for Sale by Private Treaty. The agent and you would have discussed a marketing campaign by now and the sale process will commence with an agreed marketing price.
If you have opted for the Auction Campaign after strong recommendations by the agent, chances are things could become interesting, you see this process does place pressure on the buyers that do want to buy your home.
There is normally a four to five week advertising campaign leading up to the auction date.The real estate agent would have his processes in place with advertising on line, press and local letter box drops as well as their data base and notifying all interested parties of the Auction deadline date. Inspection times are usually known as open for inspection and are designated to one specific time and day every week, for the 4 to 5 weeks leading up to the day of auction. If the property is marketed correctly there should be good volumes of people inspecting the home on the OFI days, people will generate a sense of urgency as they see other interested parties inspecting the home at the same time, this is the intention of the campaign to create a sense of urgency and competition. After each OFI day your agent should provide you with feed back on what some people may have said or possibly even a offer prior to auction.
On the auction day this is when you the owner and the agent have the final meeting and discuss all the process that has taken place and are now ready to set a reserve price. Your agent should be able to guide you here with good recommendations on reserve price and tactics if needed afterwards. the Auction Campaign will provide you with three opportunities of selling your home with out revealing the price.There are too many possibilities that may take place but offers can come prior to the auction, during the auction and after the auction, hopefully your home has sold by now.
Most auctions have a reasonable clearance rate, at times they can be as high as 90% clearance or as low as 0% clearance, average markets range between 40% – 60% clearance rate. Properties that don’t sell on the day of Auction have a very strong chance of selling within the next 4 weeks after the Auction date according to statistics.
If you happen to be one of the unfortunate home owners that has no success with the Auction Campaign, for what ever the reason may be, don’t fear as it is at this stage you can now revert to the For Sale by Private Treaty, and it is at this stage that you now disclose your sale price with good recommendations and strategies all ready to go.
The above information is not to be taken as professional advise, it has only been posted to assist those people with no or little knowledge of the Auction process. For professional advise discuss this process with your local professional real estate agent, don’t forget every body has different needs and reasons for buying and selling real estate and no two are exactly the same, all the best.