Shhh … or you might not hear about this sale
In a section of our free guide to selling property that discusses how to find a real estate agent, we advise readers to look at an agent’s previous sales history, and especially the types of sales they’ve negotiated. If you’ve been doing this, and you’ve been taking note of the different sales methods used by different agents, you may have noticed a lot of private treaty sales and a lot of auctions, but have you ever noticed an off-market sale and wondered what that was?
Technically, an off-market sale is a bit of creative spin, since a property cannot be legally offered to buyers without a signed contract of sale (and vendor disclosure agreement); the simple act of preparing these documents, however, automatically puts the property on the market.
Really, an off market sale is just a silent sale. It occurs when an agent doesn’t actively market a property to the public, but contacts buyers from their database who have expressed an interest in a property similar to the one they’re selling now.
An agent’s database is their most valuable asset
Just a note on agent databases. An agent’s database is one of his most valuable sales tools, so they’re constantly being curated and updated, to ensure only the most active buyers are listed, next to their property requirements. When an agent calls a buyer from their database, it’s not like when you get a call from Acme Free WiFi Co., which only got your number because you used their free wifi once, three years ago, when you were backpacking through Europe; these buyers are highly motivated to buy now.
The upside is that only very motivated buyers are going to inspect your property, rather than the mixed bag of buyers you may get at an open that’s been publicly advertised, but the downside is that there are fewer of them. This always makes an off-market sale a bit of a gamble.
Off-market sales are low commitment for uncertain vendors
Generally, if you’re highly motivated to sell, agents might advise against an off-market sale, unless for reasons to do with privacy or similar, you would prefer to keep the sale of your home under wraps. If, however, you’re not sure whether you’d like to sell, and you’d rather test the market first, then an off-market sale might suit you.
Because there are no marketing costs — you’re in no need of signboards, sales brochures, flyers or cards, or advertising —associated with an off-market sale, it’s relatively risk-free for the passive vendor; plus you only have to accept an offer great enough that makes the task of packing up and moving worth your while.
That being said, not all properties and areas will suit an off-market sale, and most agents only take on an off-market sale when there’s a high probability that it will sell quickly — ideally, within the first open. If yours is a property unlikely to elicit that sort of buyer interest, you may prefer to discuss alternative sales methods with your agent.
To learn more about selling property in Australia, including selecting an agent and understanding each sales method, download our free education guide, called Selling Your Property: What You Really Need to Know, by subscribing to our website. Alternatively, for more property market news, insights and analysis, continue reading our blog.
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