On a deadline
Rachael Cone of Total Realty explains the ins and outs of a deadline sale.
In our last column we discussed the pros and cons of the “auction option”, a popular method when selling property.
With summer here and many homeowners considering their options regarding the sale of their home, we delve into the deadline sale method in this issue, which remains an equally popular yet rather unique approach to facilitating a property sale.
The deadline sale method has gained in popularity among homeowners and real estate agents alike. It not only creates a sense of urgency among potential buyers but also encourages competitive offers without the pressure of an auction scenario.
WHAT IS A DEADLINE SALE?
For those less familiar with this sale method, it is a structured sale process where a property is marketed with a specified date by which written offers must be submitted. Unlike traditional auctions, where the sale price can fluctuate dramatically based on live bidding, deadline sales allow buyers to submit their best offers in writing by a 14 specific deadline.
KEY FEATURES AND ADVANTAGES OF A DEADLINE SALE
• Defined timeframe: Sellers set a clear deadline for when offers must be submitted, which can range from a few days to a few weeks. This timeframe helps to build anticipation and encourages buyers to make prompt decisions.
• Written offers: Interested buyers submit their offers in writing. This format allows them to present their best price along with any conditions they have, which most commonly include finance, insurance, a builder’s inspection and sometimes the sale of their own property.
• Transparency: Unlike traditional private treaty sales, a deadline sale provides a transparent process where buyers can compete against one another, knowing that multiple offers have been received.
• Flexibility: This method allows the seller to consider a range of offers, allowing them to choose the one that best fits their needs, whether that be price, conditions or the buyer’s situation. The seller also has the flexibility of choosing whether or not they wish to advertise a price in their deadline sale marketing.
• Competition: The competitive nature of a deadline sale can drive up the final sale price, as buyers strive to make the most favourable offer. Most sellers comment that the advantage a deadline sale brings over an auction is the less intense environment at play, while still being able to capitalise on market competition.
It is important to note that when a deadline sale does not have a price advertised it is because the seller has opted to let the market determine the value of the property. When this is the case, buyers will need to conduct market research to determine the fair market value of the property before submitting their offer. They should approach this task with careful consideration. The real estate agent will be able to provide buyers with recent sales statistics of comparable properties if they require guidance in this regard.
In summary, the deadline sale method offers an approach to property sales in New Zealand that merges elements of traditional sales and auctions, while catering to our modern market demands. By fostering competition and providing a structured sales process, sellers can optimise their outcomes and buyers can enjoy a more relaxed and transparent environment in which to make informed buying decisions.
If you would like any further information on these selling methods or real estate assistance in general our friendly team at Total Realty will be only too happy to help.
