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Private Treaty or auction?

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  • 08-04-2008 9:51am
    #1
    galwaybabe
    Registered Users Posts: 1,063 ✭✭✭


    A friend of mine is planning on selling a house in Ranelagh. He has been getting very mixed advice with regards to method of sale. Two auctioneers recommended auction and two recommended private treaty. He is therefore very confused. I've read a lot about people not showing up at all at auctions. He has asked for my advise. My gut instinct is to advise private treaty. Any opinions anyone?


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    #2
    robd
    Registered Users Posts: 951 ✭✭✭robd


    galwaybabe wrote: »
    A friend of mine is planning on selling a house in Ranelagh. He has been getting very mixed advice with regards to method of sale. Two auctioneers recommended auction and two recommended private treaty. He is therefore very confused. I've read a lot about people not showing up at all at auctions. He has asked for my advise. My gut instinct is to advise private treaty. Any opinions anyone?

    Auctions have not been achieving great results over the past 12-18 months. Having said that the papers seem to indicate some sort of a pickup at the moment. That could just be VI spin though. Putting the house to auction still allows him to set an minimum price, under which the house will be withdrawn if this price is not reached. He can then sell by private treaty if the auction doesn't work out. In a good market auctions have the potential for great upside on the price. Not sure if what will work at the moment but he still has the option of private treaty afterwards.


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    #3
    The_Conductor
    Moderators, Society & Culture Moderators Posts: 32,285 Mod ✭✭✭✭The_Conductor


    Ranelagh is a great area to try to sell- but house prices have taken a severe knock there, as they have elsewhere. Unless there are very unusual features that would factor high on potential purchasers wish-lists, I'd advise to go with Private Treaty sales.

    There are a lot of stories out there at the moment that are being spun by the industry- about how an upswing is happening and now is the time to buy again. Its complete and utter bull- don't believe a word of it.

    Providing your friend is realistic about what his/her property may achieve, and willing to negotiate with potential buyers, then they should be ok. But don't expect people to get into bidding wars with each other, regardless of how wonderful the property is, those days are long over.


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    #4
    patrickolee
    Closed Accounts Posts: 890 ✭✭✭patrickolee


    As Robd says, there is no real risk at the auction, he can always decide on a lower price that he is happy with, if it doesn't sell then sell it by pt.


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    #5
    Patrickof
    Registered Users Posts: 669 ✭✭✭Patrickof


    There is some risk to the auction - COST.

    At an auction the most important thing is making sure that there will be people present. The best way to achieve this is to advertise extensively. This can be quite expensive.


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    #6
    antoinolachtnai
    Registered Users Posts: 9,788 ✭✭✭antoinolachtnai


    I would personally say that auctions make sense in a strong sellers' market, i.e., when there are considerably more buyers than sellers. Now, Ranelagh is still a good place to be selling property, but I would say the most optimistic view is that supply and demand are fairly evenly matched. For this reason, I would go for the private treaty.

    However, if your friend needs to sell fairly sharpish and at a discount if necessary, then auction might be the way to go, but the situation needs to be made clear to prospective buyers (so that they'll show up on the day).


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    #7
    johnnyskeleton
    Moderators, Entertainment Moderators, Politics Moderators Posts: 14,505 Mod ✭✭✭✭johnnyskeleton


    antoinolachtnai wrote: »
    I would personally say that auctions make sense in a strong sellers' market, i.e., when there are considerably more buyers than sellers. Now, Ranelagh is still a good place to be selling property, but I would say the most optimistic view is that supply and demand are fairly evenly matched. For this reason, I would go for the private treaty.

    However, if your friend needs to sell fairly sharpish and at a discount if necessary, then auction might be the way to go, but the situation needs to be made clear to prospective buyers (so that they'll show up on the day).

    +1

    Buying at auction only works for expensive and / or rare properties, because you have to (or at least you should) carry out your own survey and title check before purchasing, otherwise you might end up with a dump on your hands.

    Alternatively, if there are major defects in the property, but it looks nice from the outside, selling by auction is a great way of dumping an unsaleable property on an unsuspecting purchaser.


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    #8
    antoinolachtnai
    Registered Users Posts: 9,788 ✭✭✭antoinolachtnai


    Then there is the entertainment vaue. Like the point before the auction when the auctioneer describes the property and asks if there are any questions and you ask if the dry rot is included in the sale or if it has to be negotiated separately.

    Mind you, there are not that many totally bent auctions in my experience. The usual practice you hear about is to rely on someone else having done a survey. Obviously, this is a pretty risky strategy and not recommended.


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