A Private Treaty is an agreement to sell a property at a price negotiated directly between the vendor and the buyer or their agents. Private Treaty remains the most popular or ‘usual’ way to sell property. This is because it generally appeals to more buyers and provides the seller with greater scope in negotiations.
Just like any method of sale, there are advantages and limitations to consider before making the choice to offer your property to the market by Private Treaty.
- Immediate sale is possible. If the price is right and the property is in a sought after location there is every chance to secure a fast sale.
- All buyers should make themselves known. Some buyers are reluctant to buy at auction but buying a property offered by Private Treaty is generally appealing to all buyers.
- Less stress for the vendor. The additional pressure associated with auction day is not present. Each offer can be considered and discussed with advisors and the agent at a more leisurely pace.
- The marketing campaign may be less intensive and tailored to suit the circumstances.
- Genuine buyers looking for properties within the advertised price range are likely to be attracted (although there is an increasing trend to go to market without a price).
- Receiving multiple offers is encouraging and may lead to a sale that exceeds expectations.
- It is important to partner with a knowledgeable and strategic agent. The listing price needs to hit the mark. Too low and the vendor may be short changed. Too high and the campaign can drag on leading to declining interest and a lack of buyer confidence.
- Without obvious competition between buyers you don’t necessarily know whether you are getting ‘top’ price for your property.
- Lack of urgency. Buyers may feel as though they are not required to make an immediate offer and will often ask the agent to advise them if any other offers are put forward. Buyers may feel as though they have more time to consider the property and undertake their own market research.
- Just as it is encouraging to receive multiple offers often the very nature of a multiple offer situation (in Queensland) discourages buyers to submit their very best offer and has the potential to deter a genuine buyer completely.
- The vendor is usually presented with a conditional contract including a cooling off period.
Discuss all methods of selling your home with an agent who understands the local market. Not all market conditions are the same and a marketing strategy tailored for your local market gives you the best chance at selling your property successfully.