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Sale by Negotiation? What Do You Need to Know?
Selling your property by negotiation is a great option if the price range for your property is difficult to gauge because it is unique or there is a lot of movement in the market. In this sales method, no end date is set, and offers are made based on what the buyer feels the property is worth.
Read on to find out whether this method of sale is right for you.
What Are the Advantages of Sale by Negotiation?
‘Sale by negotiation’ may help to maximise the sales price of your property as you are not setting an upper limit, as you would in a sale by advertised price. This can result in achieving a premium price without the risk of over-pricing your property. Having no advertised price may also make your property attractive to a wider pool of buyers, and, unlike an auction, the sale can draw in both conditional and unconditional buyers.
What Are the Disadvantages of Sale by Negotiation?
Unlike an auction or deadline sale, no sense of urgency is created by a sale by negotiation. Vendors looking to sell by negotiation may also have a fixed idea of the value of their property and be reluctant to drop their expectations on price. If there is little interest in a property at the desired price level it may be necessary to reconsider what you are happy to accept. The longer a property stays on the market the less desirable it may seem to potential buyers.
Another downside to sale by negotiation may be that instead of attracting a wider pool of buyers some buyers may be intimidated or put off by the lack of an advertised price.
Which Properties are Suited to this Method of Sale?
Sale by negotiation is particularly suited to truly unique, high-end properties, where a wealthy buyer may fall in love with a property and be prepared to pay a premium price to secure it. If your house has the ‘wow’ factor this might be the method for you.
How Can You Minimise the Risks Associated With Sale by Negotiation?
Providing a price guide or asking for offers over a certain price can help to reassure buyers that the property is within their price range. Being prepared to lower your expectations if the property has been sitting on the market for several weeks is important, too. This will help avoid the property becoming stale.
When providing a price guide, ensure the negotiation range is a true reflection of the amount you are willing to accept.
What if Another Method Would Work Best For Your Property?
Sale by negotiation may or may not be right for your property. Auctions and deadline sales are alternative real estate sales options for buyers who prefer not to list an advertised price. Read Crockers’ article on which method of sale is best for your property to find out the most suitable option for you.
If you’re looking to buy / sell an investment property or are after some straightforward and practical advice on property management issues, contact the Crockers Property Management team at email@example.com