Traditionally, properties have been sold using three distinct methods: Private Treaty (for sale by private negotiation), Auction (for sale by public auction on a set day and time), and Tender (for sale by expressions of interest by a closing date). But in the post-covid marketplace, a fourth option has developed as a popular means of maximizing a property’s potential value and creating a fair and transparent process for buyers – The deadline sale.
What is a Deadline Sale?
A deadline sale is simply a strategic selling plan which takes the best and most useful elements from the three previously mentioned sales methods and combines them for maximum effect – A private treaty sale with a defined sale date where buyers are able to view a property and submit offers up until a closing date and time. Typically, a property offered for sale by private treaty would be on the market for as long as it took for a suitable offer to be made that the sellers would accept, and in a normal market, this is a widely used and acceptable strategy.
In the post-covid world however, where supply of housing stock is low and buyer demand is high, properties listed for sale by private treaty were suddenly selling in a matter of hours rather than days, weeks or months, and a more structured selling process became necessary in order to ensure fairness for buyers and maximum value for sellers.
By keeping the property on the market until a pre-determined date and time (the closing date), our agents found that not only were buyers happier (as they were not being rushed into making snap or panicked decisions out of fear of missing out or turning up to open houses to find that the property had already sold), but our sellers were also obtaining sale prices much higher than expectation due to the heightened competitive atmosphere created. A “win-win” scenario if ever there was one.
How Does it Work?
Ultimately, the goal of this strategy is to eliminate the backwards and forwards negotiations of a normal private treaty sale and give every potential buyer an opportunity to submit their best and final offer on the property. This means their highest price and best terms, and once offers have closed, the agent will then present all offers to the owner for their consideration. Assuming there is a suitable offer available, the owner can elect to sell and the successful buyer is notified and a contract of sale is issued for execution by all parties.
The process for a deadline sale is as follows:
- Property is photographed and marketing material prepared
- Campaign is launched with price guide, open house times and offers closing date advertised
- Open homes are conducted at scheduled times (Minimum of 1, preferably two inspection times offered)
- Potential buyers are advised of offer process and deadline for submission
- Agent will liaise with all interested parties to ascertain their level of interest and suitability of their offer for the seller’s requirements
- Offers are submitted and closing date reached – All buyers are advised they need to submit their best and final offer as no further negotiations will be held after closing, unless the property remains unsold
- Agent will present all offers to the seller for their consideration
Benefits of a Deadline Sale
This selling strategy has proven to be beneficial for both buyers and sellers.
Benefits for buyers:
- Fair and transparent process
- No need to rush into decisions – Have time to properly consider your position
- Allows sufficient time to properly research the property before committing
- Eliminates “gazumping” and other unethical real estate practices
Benefits for sellers:
- Maximises competition for the property and provides a structured process to accommodate it
- Certainty of knowing a fixed sale date
- You’ll never have to worry that you sold too quick
- Comfort in knowing you got the absolute best price available at that time
To speak to one of our experienced sales agents about a deadline sale for your property, click here.
Til next time, ciao 😊
Disclaimer: The information is this article is for general information only, it is not intended and should not be considered as either legal or financial advice. The information contained herein should not be relied upon solely and all parties are encouraged to obtain their own independent advice before making any financial decision.
