When to use Yellow Apricot - avoiding estate agents |
YELLOW APRICOT INSTEAD OF AN ESTATE AGENT
Selling a property through a Yellow Apricot Auction may be better than selling through an Estate Agent. We can compare the two as below:
|
Estate Agent |
Yellow apricot |
Asking Price |
Set by the Estate Agent |
Set by the open market |
Actual selling price |
Usually lower than asking price |
Always the price a person is willing to pay for it |
Time taken to sell |
Average time 3-4 months
(6 weeks to get an offer & another 6-8 weeks to complete the sale) |
Property sells on Auction day with completion normally 28 days after |
Gazumping |
Can occur at any stage before Exchange of Contracts |
Cannot occur as contracts are Exchanged as soon as the gavel falls |
Price Renegotiation |
If the value report recommends a retention or essential repairs, the price can be renegotiated |
The price can never be renegotiated irrespective of recommendations in the valuation report |
Control |
The sale is completely out of your control |
Setting a Reserve Price ensures you are in control |
Condition of property |
Property needs to be decorated, de-cluttered, repaired & to be presented at its best to get the best price |
Property in any condition will sell at auction |
| National advertising |
Advertise locally to capture local interest |
Advertise nationally to gain interst from a wider market |
Chains |
If a chain is involved the property may take several months to sell and if one buyer pulls out, you may lose the sale altogether |
There is never a chain involved. The property is guaranteed to sell normally 28 days after Auction day. |
Range of buyers |
Normally one target group of buyers are targeted e.g. family |
Wide range of potential buyers, investors & speculators ensures maximum exposure |
Example
Mr & Mrs Helium have a house which has just been valued by the Estate Agent they originally bought it from. The Estate Agent valued it for £250000 and suggested putting it up on the market for £275000 and recommended they accept any offer above £245000. Mr & Mrs Helium accept an offer of £240000 on the house after 6 weeks on the market. A month later the purchasers are in a position to exchange contracts. Finally Contracts are Exchanged and the house sale completes 28 days later.
You will see from the above that the sale has run smoothly and the house has taken 14 weeks i.e. over 3 months to sell. The house sold at £240000 instead of the £275000 that the Heliums were expecting.
If they had put the house into a Yellow Apricot Auction, they may have sold the house immediately on Auction day, with completion 28 days later, the house selling in approximately 6 weeks.
Consider what may have happened if:
• a chain was involved - the house would not have sold in 3 months as all parties in a chain must agree on Exchange and Completion dates or the sale will collapse. Complications with a chain can add on several months to a sale process with no guarantee that the house will ever sell and if property values are rising, the vendor may miss out financially;
• the purchaser decided to pull out after say 8 weeks. Here the property would have been off the market for 2 months and Mr & Mrs Helium would have to start marketing the property again.
• The purchaser had decided to threaten to pull out if the price was not dropped to £230000 just before Exchange of Contracts. Here Mr & Mrs Helium would have had to either pull out or accept a sale at a £10000 discount to the original offer.
With a Yellow Apricot Auction, you have control all the time with little risks associated with selling through an Estate Agent.
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