Decide on a method of sale:
Exclusive listing
The REIQ recommends the exclusive agency method, where the sale of the property is in the hands of only one party, over an open listing, where the seller lists their property with a number of real estate agents.
An exclusive agency is advantageous to the seller as the appointed agent will be dedicated to selling the property. This saves the seller the confusion of having to liaise with more than one agent.
Furthermore, this method will save the seller the time and money involved in advertising and marketing costs when a number of agents are trying to sell the property.
Under the Property Agents and Motor Dealers Act (PAMD) 2000, a seller can only appoint an agent under this arrangement for up to 60 calendar days. During those 60 days the seller may decide not to renew the appointment if the property has not sold.
The seller can agree to make a further appointment up to 60 days, but the renewal cannot be made earlier than 14 days before the term expires.
Under any selling arrangement using a real estate agent, the seller and agent must sign a PAMD Form 22a - Appointment of Real Estate Agent (Sales and Purchases) in order to legally set the terms of the selling agreement.
Auction
The advantages of selling by auction can include:
-
Triple Threat Marketing: the vendor has the opportunity to sell their property before auction, on the day of auction, or (in the event the property is passed in) directly after auction.
-
The reserve price and a settlement date are set to suit the seller.
-
As the reserve price is not disclosed it gives the seller a chance to test the market.
-
A written marketing plan with pre-agreed appointment times enables the seller to arrange their lives during the lead up period.
-
The auction is conducted under your terms and conditions and is not subject to finance, or building and pest clauses.
-
The auction process creates a sense of urgency; buyers have a definite time frame in which they must act. Buyers see other interested parties as their competition rather than the seller. Auctions create a competitive environment
Open listing
An open listing is where the seller lists their property with a number of real estate agents in the local area. Under an open listing agreement, each agent can sell the property individually or work with another agent to sell the property.
Only the agent that introduces the buyer to the property will receive the commission from the seller.
