Should I go with an Auction or with a Fixed Price?
My experience in real estate has shown that auctions are undoubtedly the most effective method of selling your property, rather than fixing a price. There are numerous reasons for this success, including:
• An auction creates a limited and exclusive timeframe to intensely market your property and attract the maximum amount of potential buyers. This ‘frenzy’ increases buyer interest and encourages a much faster buyer response. This pressure is vital as many purchasers tend to procrastinate when looking at properties for sale privately with fixed price.
• An auction removes a set figure from your property, creating an open and competitive environment in order to solicit solid buyer feedback on price.
• Prospective buyers are more inclined to enquire/inspect properties scheduled for Auction as they believe the Vendors are more motivated to sell.
• An auction gives you an unconditional sale. It is highly likely with a private ‘fixed price” sale that a buyer will impose conditions such as subject to finance, inspection etc. Whilst these things might eventually sort themselves out, it slows the selling process down and it can result in frustrating time delays for you as the seller. With an auction, unconditional contracts are signed and exchanged immediately upon the fall of the hammer and a 10% deposit paid by the purchaser. There is no opportunity for your purchaser to have “buyer remorse” and use their 5 working day allowance to “cool off”!
• Auctions create intense competition between interested parties, often resulting in a much higher price being obtained than the fixed reserve price. Obviously this cannot occur with a private sale.
• An auction offers three opportunities to sell. Firstly, if a satisfactory offer is made prior to auction, a sale may be a result. The greatest chance should present itself on auction day. If the auction is not successful, most properties usually sell within a very short period after the auction.