Should You Accept An Offer Prior To Auction Or Tender?
By Craig Lowe
I have written before about the importance of maintaining the negotiating power with you as the owner. All too often we see a poorly thought out process, which does not allow the owner or agent to maximise the result, no matter how good they are. Typically this occurs when the chosen sales process does not push buyers to a competitive stand-off. One current example is selling by Closed Tender – If Not Sold Prior.
Now there are only three reasons that a buyer will not wait for a tender date and insists on offering now:
Firstly, they have a genuine interest in another property or they have another time conflicting time commitment such as a trip overseas. Because most house in Wellington are unique, experience has shown us that a stated preference for another property in the event of offers not being considered prior to a tender date is usually a smokescreen. A competent agent will be able to hold on to these buyers until a tender closing in a couple of week’s time.
Secondly, the buyer wants to buy cheap as they are a bargain hunter. We often hear a buyer say that they don’t like the tender process. With a little digging we usually find that they have missed out on four or five tenders prior. Now clearly if they are missing out on tenders, they are missing out for one simple reason. Their offers are not good enough! Is this the type of buyer that you really want to be negotiating with?
Thirdly, the buyer loves the property and they really do not want to miss out. This is the buyer we want and we know that we will always get more money from them in a competitive tender scenario that when they are negotiating one on one. Considering tenders prior to a closing date dramatically weakens your ability to get a premium price. On tender day you will have the security of knowing that the offers tabled show all of the interest in the market place. Considering a one off offer earlier on may allow you to sell for an OK price but it will never get you that premium of a hundred thousand dollars.
And always remember there is more than one agency/salesperson that knows your area and your market. If you have had advice on a selling strategy already and would like a second opinion, please contact me anytime on 021-764-647 for a free and confidential consultation.