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Method of sale
You can sell your property by private sale or at an auction. Make sure you understand all the advantages and disadvantages before deciding how to sell your property. For more information, view Understanding property prices.
In a private sale:
- you negotiate with a buyer to agree on a sale price and terms. You can also do this through an agent (if you have engaged one)
- the contract of sale can be conditional, with your approval. This means the buyer can make the sale subject to obtaining a loan, a satisfactory building inspection report, or other conditions
- for residential and small rural properties, the buyer has a three business day cooling-off period (with exceptions). For more information, see Cooling off on a property sale - Buying property by private sale.
At a public auction:
- the price is determined by competitive bidding between prospective buyers
- the contract is unconditional. The buyer cannot make it subject to conditions such as finance or inspection
- there are usually additional costs, such as the auctioneer’s fee
- you may have a better opportunity to sell by a specific date; however, there is no guarantee your property will sell
- there is no cooling-off period.
If you use an agent, they will recommend a method of sale based on:
- the type and location of your property
- market conditions
- your timeframe and personal preference.
Reserve or asking price
This is the lowest price at which you are willing to sell your property. It is called the ‘reserve price’ if you are selling at auction, and an ‘asking price’ if you are selling by private sale.
To help work out your reserve or asking price:
- get to know prices in your area by checking websites and newspapers for similar properties listed and sold locally, and attending auctions and open for inspections
- use the agent’s estimated selling price as a guide
- consider paying for a valuation by an independent valuer
Be realistic and do not allow emotion to cloud your judgment. This will help you avoid disappointment and the risk of buying a new property based on unrealistic expectations of what your current home is worth.
The sales campaign aims to attract prospective buyers and encourage them to inspect a property, usually through advertising and direct notification.
This is the main way of attracting prospective buyers. The advertising strategy will depend on the type and location of your property and your budget.
Advertising lets prospective buyers know that the property is for sale. It generally includes the inspection dates and times, and details of the agent handling the sale.
Property advertising must not be misleading or deceptive. It is illegal to misrepresent a property in any way when advertising or marketing that property, whether verbally or in writing and photographs. For more information, view Advertising and representations – estate agent obligations.
You must ensure any information provided to the agent about the property is factual and up to date. If advertising is inaccurate, and a buyer can prove a property has been ‘misrepresented’, the buyer may be able to take legal action.
The agent may contact some prospective buyers directly. These are people who have previously asked the agency to contact them when suitable properties become available for sale.
When marketing a property, it is illegal for an agent to quote or advertise a figure that is less than:
- your asking price or reserve price (if you have given one)
- their estimated selling price, or
- a written offer you have rejected because it was too low.
Underquoting can occur when a property is advertised at a price that is less than the estimated selling price, your asking price, or at a price you have already rejected. For more information, view Understanding underquoting.
Before advertising your property for sale, an agent will generally ask you to approve the advertised price and to confirm in writing that you will consider all offers at the advertised price or within the advertised price range. The advertised price range cannot be more than 10 per cent.
Agent's estimated selling price
This is the price the agent estimates a property is likely to attract. It must:
- be reasonable, and
- take into account the sale prices of the three properties that are most comparable to your property.
The agent’s estimated selling price must be included in the sales authority and can be a:
- single price – for example, $500,000, or
- range of up to 10 per cent – for example, $500,000 to $550,000.
If the agent’s estimated selling price changes because it is no longer reasonable, the agent must:
- inform you in writing
- update the sales authority.
If the advertised price and the indicative selling price in the Statement of Information for your property are based on the agent’s estimated price, and the agent’s estimated price changes, the advertised price and the indicative selling price must be updated. For more information, view Statement of Information - Understanding underquoting.
If you have not given the agent your asking or reserve price, the property must not be advertised at a price that is less than the agent's estimated selling price.