Buying a property anywhere in the world is a lengthy process. Apart from emotional and mental approval, you will have to go through various other major steps like extensive research, deep evaluation, smart negotiation, and then finally making a purchase.
Oh! Wish the process was as easier as it seems in the first paragraph. But the reality is that buying a home requires you to follow some steps in order such as
- Determining the budget
- Saving for the house deposit
- Finding the best home loan rate
- Looking for the ideal property/house to buy
- Making a purchase and settling down
- Getting your house and your belongings insured
You can run through the above steps smoothly if you hire the right real estate agent. Having a real estate agent by your side will prove to be a boon. One of the topmost benefits of hiring a real estate agent is that you stay stress-free throughout the process. Everything from A-Z is handled by your real estate agent. If you are thinking to buy a property in Australia, reach out to the licensed real estate agents in Hampton Park.
In general, real estate agents use four major methods to sell property, which is:
- Private Treaty
- Tender and Expression of Interest
Now let us understand the selling methods and their benefits in detail.
Selling Property Through Auction
An auction is defined as the event of a sale where potential buyers put competitive bids on assets either in an open or a closed format.
This is one of the most famous methods of selling a house or any other service.
Here the goods and services are sold to the highest bidder. In simple words, the one who is up to pay the most takes over the deal.
Many people prefer buying through auction because they believe they will get a good deal on assets or homes they are looking forward to buying.
As a first home buyer, here are some of the important things that you must know:
- Only a licensed real estate agent conducts an auction.
- It is conducted following strict rules and regulations.
- The rules are different for different areas. So, you must know about yours.
The Auction Process
The auction process is carried out in steps.
- As a buyer, you must reach out to your real estate agent and ask him/her to make a pre-auction offer to the owner.
The auction offer will contain all the information like the amount you are willing to pay. Then submit it a week or two before the auction day.
Pro-Tip – Add the amount that will attract the seller’s attention.
- Register your bid on the auction day to start the bidding process.
- After registration, each bidder is given a bidder card with a number that is used to identify all participants.
- The owner or the seller will set a minimum reserve price for the property.
- Next, the bidders call out their bids. Each bid is higher than the subsequent bid. The bidders raise their bid cards to announce their bid price.
- The one who agrees to offer the highest bid is given the asset.
If the bids do not meet or exceed the amount set as the reserve price, the asset is withdrawn or the property is passed in. If this happens, there is always an opportunity for you to negotiate a sale with the owner/seller.
The process of auction creates a sense of urgency. This is the time when a buyer is given a chance to act or they may lose a good deal.
The auction is carried out openly which creates a competitive environment, therefore giving a fair chance to the seller to sell at the highest possible price.
The seller’s benefit – the home is sold at a true market value.
Some sellers also allow part of the deposit to be paid at the end of the auction. If such is the case, you must identify it in the contract.
As a buyer, you must complete the home inspection before the auction day because auctions do not provide a cooling-off period. It means you should be fully sure about the property you are looking forward to buying.
Benefits of Buying a Home Through Auction
- Auctions are an efficient way to buy property at a competitive and potentially highest price.
- Saves time as you do not have to go through a lengthy sales process.
- Auctions are a good way to land a bargain.
This is a type of selling where the owner of the property sets a price they want for the property. The price is fixed after conducting market research and discussions with the real estate agent. For instance, the real estate agent in Narre Warren negotiates with each and every party who shows interest in buying the property. The owner closes the deal with the one who is willing to offer a great price.
A private treaty is also called a ‘private sale’. In this method, the property is open for sale on the market throughout the time property is listed. This method enables the seller to get interested buyers through the time the property is listed for sale. The owner can also extend the time period.
Process of Private Treaty
This type of selling includes the following steps:
- The seller or the real estate agent in Hampton Park will list the property for sale at a predetermined price as said above.
- Interested buyers make offers on the property.
- The real estate agent or the seller will negotiate with the buyers for the right price and settle the contract conditions.
- Both seller and buyer agree on the price and the contract conditions.
- Contracts are reviewed by conveyancers and solicitors.
- The contract is signed by both the seller and the buyer.
- The buyer pays a deposit and the cooling-off period starts.
The cooling-off period is the time when both buyer and seller settle their differences before taking any further action.
- After the settlement is made, the cooling-off period ends and the contract is binding.
Benefits of Buying a Property Through Private Treaty
- You or your real estate agent can make a conditional offer.
- This may mean that you agree to buy the property, but your offer is subject to conditions — like getting your finance approved, or the home getting a satisfactory building and a pest report.
Selling Through Tender and Expression of Interest
These two selling methods are almost similar to the private treaty. But these are usually used for premium properties. Both these methods are formal and require written offers which are passed through your real estate agent to the owner of the property.
Expression of Interest
You must send an ‘expression of interest document to be sent in by a specific date.
It is an opportunity to present yourself in a clear manner through a professional document. It presents you with a chance to provide information and demonstrate your interest, suitability, and availability in relation to the position. In the EOI, the property price is not advertised.
In the case of tender, the buyers or their real estate agents in Hampton Park need to submit a formal proposal as a response to the seller’s tender price. In this method, the buyers compete against one another and submit an offer. But neither of the buyers knows what each of them is offering. This is also called a silent auction. In this case, too, the property is sold to the highest bidder.
Looking for real estate agents in Hampton Park, or nearby suburbs? Contact the best real estate agent, Manny Singh, and get all your real estate needs covered.