The decision to sell your home involves several factors like timing, selling price and method to maximise value. If you’re a first-time home seller in NSW, you should get acquainted with the different home sale processes to suit your specific situation. Generally, homeowners enlist the services of a real estate agent to sell their properties via two main methods – private treaty or auction.
Private Treaties
When you decide to sell through a private treaty, you decide on a selling price and the home gets listed at that price. Potential homebuyers are informed of the selling price of the home in advance, so they can negotiate if necessary. This usually involves the seller asking for a higher price and may choose to bring the price down for the right buyer. A private treaty gives the owner better control and time to go through several home offers. There isn’t an official selling date, so the sale can take place immediately or after some time. These types of sales can include a cooling-off period – giving the buyer the opportunity to back out of the home sale agreement. Under legislation in NSW, all contracts for selling residential properties below 2.5 hectares have a cooling-off period of five business days – ending at 5 pm on the fifth business day.
Auctions
Selling your property through an auction involves an open bid. Auctions are privy to an estimated price guide, based on comparable properties in the area. They are expected to attend the auction and bid against other buyers. You must set a specific price (reserve price) before undertaking the auction. This is the minimum price at which your home can be sold. Auctions are soaring in popularity because it offers you a guaranteed sale date and the open bidding process can drive up the sales price – so you maximise the value of your home. There is no cooling-off period at an auction – so there is no chance for the buyer to back out at the last minute. If your minimum reserve price isn’t met and the sale doesn’t go through, an agent usually tries to negotiate with the highest bidder or other bidders and the property will convert to a private treaty sale.
Exchanging Contracts And Settlement
Legal sale contracts are necessary regardless of whether you go through an auction or private treaty in NSW. There are usually two copies of the contract – for the seller and the buyer. Once you sign your contract, it is exchanged with the other party for their signature. This is usually done through an agent, conveyancer or solicitor. When the contract is exchanged, the buyer is expected to pay a 10% deposit (on the purchasing price) for securing the home. This is a critical part of the selling process, as neither the seller nor buyer is legally bound till the signed contract copies are exchanged. The final settlement is the entire transaction and typically transpires approximately six weeks after exchanging contracts.
Note for NSW homeowners with swimming pools
Here’s something all NSW homeowners with pools should keep in mind – From 29 April 2015, all homes with swimming pools cannot be sold unless they possess a valid Certificate of Compliance. Some work may need to be done for the certificate to be issued, so get acquainted with the process from your real estate agent before you sell your home.