Selling your home can seem like a complicated, even daunting prospect. Fortunately, we’re here to guide you through the process!
Traditionally, homes in New Zealand are sold using one of four methods – Exclusive Agency, Public Auction, Tender, or Set Date of Sale. Your agent will be able to talk you through the pros and cons of each of them, and will work with you to determine which one best fits your needs. In the meantime, here’s a general overview of each option.
Sale by exclusive agency
Your home is listed exclusively with an agency who are responsible for actively marketing it. The terms and conditions of the final contract can be changed during the negotiation process in accordance with the needs of each party, and you can choose to market your home with, or without, a price.
Marketing your home with a price can have its drawbacks. Placing a price on your home guarantees that the amount set is the maximum price you will achieve – people often offer less, but seldom offer more than the asking price! As a result people often overprice their homes, which can have a negative effect by turning your target market away before your agent even has a chance to negotiate with them.
Sales in this format have no set deadline – they simply run until you receive an offer you’re happy to accept. That means there is little urgency and you’re at the mercy of market conditions and the buyer’s individual circumstances.
Sale by tender
The tender process is similar to an auction, although offers are made confidentially rather than in a public forum. Purchasers complete a tender form with an offer price and a preliminary deposit by a set date. As the seller you’ll open all the offers at the same time, and can choose to accept, reject or further negotiate with whichever tender you wish.
Unlike auction, purchasers can add conditions to their offer, which could lead to considerable negotiations before a confirmed agreement is eventually achieved.
Sale by public auction
Auctions are widely regarded as the best way to achieve a premium price for your property in the shortest possible time. Your property is marketed without a price, eliminating the chances of under-selling or over-pricing.
The set timeframes of an auction allow your agent to put together a comprehensive marketing campaign targeting specific buyers, ensuring maximum exposure for your home. Ideally this results in more bidders on auction day, with the competition to own your home driving the price up. The unconditional contract of sale will be established purely on your terms.
Attending an auction is an exciting, emotional experience, and people who are determined to own your home can often be encouraged to pay far more than you would otherwise have achieved. The auction process creates a genuine sense of urgency, but still gives purchasers the time to arrange finance and complete their own research.
Set date of sale
Similar to the tender process with a couple of key differences. With a Set Date of Sale there are no set requirements around deposits, and you can accept offers.