FAQ: Can I sell my property before auction?
Sometimes when you are selling a property, you just want a quick sale. Perhaps you want some fast liquidity, or you need the capital to put a deposit down on your new house, or maybe you just want the whole process done and dusted.
In the run up to your day of sale, you could receive a few pre-auction offers for your home from interested buyers. You might be wondering whether this is allowed, and what the advantages of accepting such an offer might be to you as a vendor. As always, we recommend discussing any offers with your real estate agent to ensure you have the right advice for your situation, but here is a basic guide to get you started.
What is a pre-auction offer?
This is a way of avoiding the auction process for both the buyer and the seller.
A pre-auction offer occurs when an interested party, in the lead up to auction day, attempts to purchase your home before the auction actually occurs. According to the Real Estate Agent’s Authority of Australia, this is a way of avoiding the auction process for both the buyer and the seller.
Sometimes, the buyer may want to make a conditional offer for the property, which is not allowed on auction day (sales are unconditional at auction).
What happens if I accept?
If you choose to accept the offer, one of two things will happen. If you desperately want to sell, you can cancel the auction altogether and sell by tender.
This is generally not a good idea, except in special circumstances. The Real Estate Agent’s Authority of Australia describes how selling before the auction day can result in a lower price due to a lack of competition, as well as potentially having signed up for a sale that is conditional.
On the other hand, a pre-auction offer can be accepted but the auction can continue.
On the other hand, a pre-auction offer can be accepted but the auction continues. This usually results in the auction being brought forward to occur within the next few days, and the offer price is the starting bid.
Auctioneer Grant Child told the Bay of Plenty Times how it is often “in the vendors’ best interests to just bring the auction forward”.
This is the best of both worlds, as you have accepted an offer that is reasonable, you have the chance to up the price at auction as well and you are getting your home sold quickly, too.
There are other requirements for pre-auction offers and bids for a vendor that your local real estate agent can talk you through, but a pre-auction offer just be the ticket to getting the best auction results for your property.