Thousands of Victorians auction their homes every month, but it's not always easy to decide if this is the right option. While real estate agents will often give you advice, it's important to know the factors you need to consider before committing to an auction. If you want to sell your home, but you're not sure how to do it, learn more about the reasons why an auction sale is often the best choice in Victoria.
Helps you get a quicker sale
Real estate agents often recommend an auction when a seller is in a hurry. Some sellers need to raise cash quickly, while others may have a new life overseas and simply can't wait long for a sale to go through. Since 2010, clearance rates on Victorian auctions have remained above 50 percent. In 2014, clearance rates have not fallen below 65 percent, proving there is a strong property market for these sales.
With an auction, you have control over the process. You can set your price, listen to buyer feedback and hold the auction in a fixed period. With a traditional sale, the transaction can take months or even years.
Creates a different emotional journey for buyers
The auction process puts your buyers into a different emotional journey. You allow them to look around the home, ask questions and fall in love with the property before the matter of price even comes up. With a conventional sale, the price is nearly always the first thing a buyer will see.
This emotional environment puts the seller in a stronger position. By the time potential buyers come to the auction, they often have an emotional attachment to your property. This can drive price and pace, which is music to any seller's ears.
Allows you to plan your time more effectively
Selling a property is a stressful time in anyone's life. If you're planning an overseas move or just trying to buy another property to move into, the auction process allows you to plan more effectively. You can set dates for your open house visits, you can set a fixed time for any meetings or discussions with buyers and you can pencil in your auction date.
Auctions are good for sellers that need certainty and want to carefully plan their time. For example, Victorians living overseas may prefer the structure and schedule of an auction sale because they don't want the process open for an undefined period.
Helps you get a premium price
For a seller, the best possible outcome during an auction is to end up with multiple bidders aiming to get the property. When this situation happens, prices can often escalate and auction sales are generally responsible for all the record-breaking prices in Victoria.
An auction is often a good way to play the property market in areas of high demand. If your property is on a street where nobody has sold their home for some time, an auction could tease out a lot of buyers willing to pay a premium. An auction is also a good strategy to test the market if you don't really know what the property is worth.
Simpler terms
The auction process is contractually simpler for both parties and can help sellers avoid some of the pitfalls of traditional sales. For example, there is no cooling off period for buyers, so a winning bid seals the deal and commits the buyer to the purchase.
An auction contract also has no 'subject to finance' terms, either. This clause exists when the buyer needs to secure funding from a lender and can derail a sale if something goes wrong.
Many homes sell via auction in Victoria every month. If you're looking for a faster sale, or you just want more control over the process, an auction could give you the solution you need. Whether you're buying or selling, contact a buyers advocate, such as WBP Property Group, for help during this process.
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