Does selling apartment by auction method recommended?

I am recently thinking to sell my apartment in Sydney so I called up an agent to have a look and see what he could do about it.

I was expecting they'd be telling me by doing open for inspection but however, I am surprised they recommend me to sell it by auction and it can be sold higher than expected price due to first home buyers and economy boost in recent months.

The price I would be looking is around $650K. I mean I have never actually been through the process of selling it by property auctions in my life before and my major concern is that I'd might end up getting the price lower than expected. Even though I put my reserve price, I'm still concern after all these 4 weeks advertising campaign and did not reach my expected price & want to withdraw the price (if the price did not meet my expectations at the auction), I would be wasting $$

A few questions here:

1) From what my agent told me, would it be true that going through the auction is recommended and well worth it to get a higher price?

2) What is the approx. cost and\or the breakdown if I was to do the whole campaign e.g. advertising, auction fee etc.

3) And what are the pros and cons of selling in the auction through an agent?

I have not given an answer to the agent yet but I would like to do more homework before officially making a decision

Your feedback would be very much appreciated.
 
I wouldn't auction unless it was a rare property. In my opinion auctions only benefit the agent as they have less work to do and you pay for it weather or not it sells. If you go private treaty you shouldn't have to pay until/if it sells.

And think about this, If the top bidder only has to out bid the second highest bidder how do you know that the amount they go to is the highest amount they are prepared to pay? They only have to offer $1 more than the second highest bidder to win!

Ask how many people here who have won a property at auction, if they were prepered to pay any more than they did.

A good agent should be able to get the best price for you without an expensive auction.
 
I dont agree with your post, there are many instances where we have obtained prices at auction that we could never have dreamed of achieving through private sale.
 
In Melbourne, we found that doing an auction was only $200 difference than not doing - so we just did it anyway, and if it didn't sell, just put it up for sale.

Not sure if that how things work up your way...


The Y-man
 
at this time, go to some agency which has offices in china.... they get connections directly that come in.

in china...most ppl live in apartments.. so it's not a big lifestyle change, 2nd.. with the opening of the foreign investment they investing like crazy.
Also, some of them just come in for a couple of weeks.. so they're rushed for time to buy.. and will pay top dollar for properties they like.

Check this article

http://www.theage.com.au/business/chinese-buyers-fuel-topend-property-boom-20090918-fvga.html
 
...I am surprised they recommend me to sell it by auction and it can be sold higher than expected price due to first home buyers and economy boost in recent months.

And how did they demonstrate this to you? Recent higher-than-average expected sales in your own block? This should be your very first port of call as it's where buyers will go to justify price (as well as the bank valuers :D)
Make sure YOU know the recent sales and the agent isn't buying your listing with expectations of a higher price (only to dripfeed you via conditioning later down the track) - this can occur.

As to auction campaigns, I agree with others in that you need to surmise what's common in your area (where are you?). If auctions are frequent (as per East/Inner West) then it may well be the correct selling method. If not, and your unit is like one of many others on the market (make sure you know what your competition is as your buyers sure will) then why auction?
Put yourself in the buyers shoes and you might get a better inkling of how to proceed. Also ensure you get the very best agent for the area and type of dwelling you're selling. They're certainly not all equal :)
Best of luck!
 
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