Selling by expressions of interest

Discussion in 'The Buying & Selling Process' started by Cadbury99, 8th Oct, 2017.

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  1. MTR

    MTR Well-Known Member

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    Not necessarily, its dependent on the State as to whether auctions work or not.

    EOI is like a dutch auction sort of.

    Marketing is key and potential must be highlighted.

    Most important factor when selling is who you employ, we have a gun RE agent.

    We know it will sell any day of the week to a developer but this is not necessarily who we are targeting.
     
  2. Sackie

    Sackie Well-Known Member

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  3. Scott No Mates

    Scott No Mates Well-Known Member

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  4. Scott No Mates

    Scott No Mates Well-Known Member

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    True, auctions don't work in the Brisbane market or western Sydney so much but work a treat in the inner ring.

    Not quite a dutch auction either at the DA starts at a high price and the bidder stops the drop at the price they're prepared to pay, first to push the button wins (the Sydney fish market uses this system).
     
  5. Cadbury99

    Cadbury99 Well-Known Member

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    Yes auctions work in the inner ring in that they more often than not acheive a sale. Question is do they acheive the best price for the seller? Or a quick commision for an agent.

    Is there anybody out there who has used an EOI to sell a residential property?
    How did it go?

    I can see from here that certainly some buyers don’t like them. There again, are lots of buyers that don’t like auctions. In inner ring Sydney it’s difficult to avoid dealing with unpriced property (mostly auctions).

    Would it put off fewer people if we didn’t call for expressions of interest but instead put it for sale with a range and a cut off date? That is best bid in or above the range by the date will gain the sale. An EOI without saying so.

    I’m hesitant to auction in the current market with a high priced property for the suburb for fear of no bids, only low bids, or going out on a vendor bid.

    Thanks to everybody who has contributed so far. It’s helping me get my thoughts in order.

    The next stage is definitely a strong marketing campaign. I just need to decide the best method of sale.

    If it were in a cheaper range then no question I’d be going with an auction. In fact I will be selling this way shortly for an apartment I’m selling.

    For a high priced unique property I need someone to fall in love with it and be prepared to make a strong offer to secure the sale. For a good auction I’d need at least two of these people.
     
  6. Sackie

    Sackie Well-Known Member

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    Generally speaking for the average nothing special type property I generally go with For Sale (unless in a boom market where any crap can hit auction records), higher end market or a property that is unique I go for Auctions.

    However its important to keep in mind what strategy has been working best for a particular stock/area/time when choosing a marketing strategy. I dont like EOI much as I think it can quickly turn into a double edged sword. I have seen many EOI sales and then 2 weeks later I see a price guide which immediately lets me know the interest/ competition level isn't that great or as the owner expected -- the blood has started dripping.
     
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  7. Cadbury99

    Cadbury99 Well-Known Member

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    It’s actually my valuation based on all of the above and looking at comparable sales myself in neighboring suburbs. Record price in this suburb was for near new build with more beds/ bathrooms but smaller block so not really comparable.

    I actually won auction in 2009 so not quite at peak. It was definately an emotional decision as it was for my (our) PPOR. It was an auction and I was determined to win it. There is a long story behind it.

    I agree a suburb record is not important to me. It would be a poor buying decision for an investor but I’m not so sure for PPOR purchaser. That’s more of an emotional decision.
    It’s no longer a rising market - more of a stagnant market with potential to go sideways for sometime or slightly downwards from the peak.
    The agent is going to have to work hard to find the right buyer.


    Perhaps but it only works if you can find multiple buyers who absolutely want it. Even then perhaps the highest bidder would have been prepared to pay more.
     
  8. wylie

    wylie Moderator Staff Member

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    Knowing I'd not bother looking at a house without a price, I'd never try to sell this way. Why cut out any potential buyers?

    The one time we did enter into a tender, we were told by the agent that the house would not sell for under $600k and not to bother with an offer less than that. We offered $590k. The other two offers were something like $620k and $650k. All were refused. Months later it did sell for slightly over the highest offer.

    So all three who bothered to put in an offer were lowballing anyway.

    If that house had been priced at, say, offers over $690k, then they would have likely got what they eventually did get but without having to wait months for it.
     
  9. wylie

    wylie Moderator Staff Member

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    That is a tender. Same, same... and you'll still have people who don't bother playing that game.
     
  10. Cadbury99

    Cadbury99 Well-Known Member

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    Seems that EOI and tender are used interchangably, certainly by some Selling Property By Tender - Pros & Cons - Tips and advice

    In Sydney’s midring it would be difficult to purchase without looking at unpriced properties as nearly everthing is auctioned. Other cities/areas are somewhat different in terms of publishing asking prices.
     
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  11. Sea Eagles88

    Sea Eagles88 Well-Known Member

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    @Cadbury99 please keep us posted with the outcome. As your agent said, you are selling at the peak, if you are not in hurry to sell, why sell ? Or why didn't you sell 6 months ago ?

    As a buyer, I absolutely hate EOI, one agent in West Ryde Green Real Estate always use this method, I will never considering their properties for sale ever again. They absolutely screw the buyer around, I put in 3 offers and was kept getting told it wasn't enough despite me asking what is an acceptable amount and I up the amount to the acceptable amount.
     
  12. wylie

    wylie Moderator Staff Member

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    There's your answer then.

    And if you find nobody is much inclined to put in high offers, and your property goes stale, then at least you can pull it off the market and wait a while. If the market does drop, you aren't forced to sell.

    We didn't leave our property without a price for longer than two OFI (about 8 days in total) before pricing it. First contract fell over on finance (not due to valuation, but wife had to fess up to bank she was pregnant and wouldn't be working going forward), second contract was considerably higher than first. Buyer absolutely fell in love with it and we nearly fell over when we saw her offer. Next OFI her friends came with her and talked her into pulling out under cooling off. To be honest, I wasn't surprised (and that is a danger you would also face - especially with a bank valuation possibly falling short of any unusually high offer).

    Third buyer was playing games "I might sign tonight if I'm in a good mood, might not" so we told agent to rip up the contract and we won't deal with that joker, fourth contract went through.

    Our house was in real danger of being stale, actually it was stale by this stage. We were on the cusp of people wondering "what is wrong with this property?". We didn't need to sell, but once you get to this stage, you just want to move on with life. At least we did, and didn't want to pay listing costs again. ;)
     
    Last edited: 9th Oct, 2017
  13. Cadbury99

    Cadbury99 Well-Known Member

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    I will update with my decision on the selling method chosen and on the outcome.

    Reasons for selling - got engaged, would be nice to setup new home with new partner rather than her feeling like she is living in my late wife’s house. It’s about moving on but no rush. I wasn’t ready to move on 6 months ago.

    If I go to EOI/tender then I will not stuff buyers around. Best offer (price and terms) by the date over published lowest acceptable bid will get the sale.
     
  14. wylie

    wylie Moderator Staff Member

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    Good luck with whatever way you go. At least you have a few other perspectives than just that of the agent.

    And I'm sorry to hear the reason for the sale. :(
     
  15. Cadbury99

    Cadbury99 Well-Known Member

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    Thanks, that’s where my thinking is heading.
    At least with the tender process I should not have to put up with people pulling out. All offers would be signed contracts with cooling off rights waved (same as bidding at auction).

    It’s a stressful thing selling real estate. There are no right answers but plenty of wrong ones!
     
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  16. MTR

    MTR Well-Known Member

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    All the best
     
  17. Cadbury99

    Cadbury99 Well-Known Member

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    Thank you, got to look at the positive. My new fiancé is fantastic unless that is what you were getting at :) I’m a very fortunate person to have had three wonderful loving women in my life (mother, late wife, and new fiance).
     
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  18. wylie

    wylie Moderator Staff Member

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    I'm glad to hear that you've found happiness again. I was thinking that selling your house must be bitter/sweet. One part would want to stay there and the other part would want a fresh start. Understandable I think.

    Good luck with it all. :)
     
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  19. Cadbury99

    Cadbury99 Well-Known Member

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    Good news. The property around the corner that had a ridiculously low guide price sold at auction today for over $250k more than the original guide price (which was raised by 60k this week). Still a little under what it was worth in my opinion but the market is softening. It certainly looked like the top bidder would have been prepared to pay more.
    Time to kick off the marketing campaign - it will be easier to justify the price guide on my house now.
     
  20. MTR

    MTR Well-Known Member

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    Expressions of Interest (EOI)

    It worked for us, we have had 3 offers on a property we listed using this strategy. It was listed 3 weeks ago. We will be accepting one of the cash offers

    Using this strategy has a lot to do with the property (unique) and how good/aggressive the re agent is

    MTR:)
     
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