A. The roles of agent and seller
When a seller signs an agreement with an agent, the agent undertakes to try to sell the property for the highest price possible within a specified time frame, and to act as the seller’s representative in managing all aspects of the sale. This commences with the initial appraisal of the property, including advice on possible sale price and marketing and promotional strategies.
As the seller, you are represented by the agent, who co-ordinates the marketing and promotion of your property, generates interest from prospective buyers and handles negotiations, which at times can be sensitive.
The agent is the intermediary, who can relieve some of the stress that you may otherwise feel. They have experience in facilitating the sale process from the start through to inspections, price agreement, exchanging of contracts and settlement.
#Violater.com is NOT an agent. It is a platform for owners or vendors to offer their properties for sale by way of online auction system or fixed price. This website was developed and operated by KHAI KWAN which is a legal firm in Sydney. We provide a free platform service and do not get involve in your auction, negotiations and dealings. We do monitor this platform and maintain an absolute right to terminate any process without notice that is considered to be against the public interest. It is up to the individual owners, vendors, agents and buyers to interact to reach a determinative agreement. This is not notwithstanding that Legal practitioners are exempted from the Property, Stock and Business Agents Act 2002 at Section 5 (2). See
"5(2) This Act does not prevent any person for the time being entitled to practise as an Australian legal practitioner from exercising any function that, had this Act not been enacted, the person might lawfully have exercised as an Australian legal practitioner".
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B. How to Sell – Private Treaty or Public Auction?
i. Sale by private treaty
When you sell your home by private treaty, you set a price and the property is listed for sale at that price. In general however, the price is negotiable, with the seller often asking a higher amount than they expect to sell the property for and the buyer making an initial offer lower than the asking price. This is normal practice, with the agreed price usually being somewhere between the two.
The process of a sale by private treaty offers the following benefits:
- Greater control over the sale;
- Time to consider offers by potential purchasers;
- The easy ability to extend the time for which your home is for sale; and
- The fact that potential purchasers must make offers for your property ‘blind’, without knowing what other buyers think it is worth.
Selling by private treaty can be just as intense as selling by auction, and you will be faced with important decisions if you are presented with offers lower than you hoped for.
There are risks with selling by private treaty which also should be considered:
- If the price you set is too high, your property may not sell; and
- If the price you set is too low, you may miss out on maximising the selling price.
You should also be aware that when a property is sold by private treaty, the buyer has a five day cooling-off period during which they may withdraw from the sale.
#You can also provide a BUY OUT ITEM OR BUY OUT PRICE in your listing in Violater.com. This means the buyer can buy without the need to bid any further. BUT there is a cooling off period of 5 days..#
ii. Sale by auction
To sell through an auction process, the amount you want for the property is generally not revealed to potential buyers who are encouraged to attend the auction and bid for the property against other potential buyers.
#This is where Violater.com can assist by its online auction platform. Under the Property, Stock and Business Agents Act 2002 - Sect 3, "real estate agent" means a person (whether or not the person carries on any other business) who, for reward (whether monetary or otherwise), carries on business as an auctioneer of land or as an agent: etc. There are strictly two elements being for "reward" and "carries on a business" then by law one has to be licensed as a "real estate agent" to do auction. A homeowner does not seek reward nor carries on a business of auctioning. There is nothing that says he or she cannot auction their own property in the Act 2002. There is no requirement in law for homeowners to hire an auctioneer to sell their properties just like in private treating sale, an auction is merely a method of selling like negotiation. There is also no cooling off periods in Auction though. #
Auctions offer the following benefits:
- You do not have to disclose the selling price upfront;
- You have a set timetable, with an auction-day deadline to plan by;
- You can dictate the terms of sale;
- Bidders are cash buyers—they must enter into a contract upon the fall of the hammer and there is no cooling-off period;
- Auctions create buyer competition and can thereby achieve the highest possible price;
- They are highly suitable for genuinely different or special properties, especially those of high worth; and
- You can sell beforehand, on the day or afterwards—the choice is up to you, guided by the expert advice of the agent.
#By using Violater.com you can practically do all the above using our control panel in member areas when you list your property but without using an agent#
Setting a reserve price
The reserve price is the lowest amount you are willing to accept for your property, and it is normally set, after consultation between agent and vendor (seller) just before the auction. The reserve price is not revealed to prospective buyers before the auction (and possibly not after it).
#Violater.com requires you to include this reserve price. This price is not reveal but our system provides an indication when the reserve price has been reached. #
If the highest bid is below the reserve price, you, the vendor, have the option to accept it or not. If you do not accept this highest bid (and there is no obligation to do so), the property will be ‘passed in’. You can then either try and negotiate a price with interested bidders or put the property back on the market, at a specified price.
If the bidding continues beyond the reserve price, the property is sold at the fall of the auctioneer’s hammer to the highest bidder.
Successful bids
The successful bidder must sign the sale contract and pay you a deposit on the spot (usually 10%). There is no cooling-off period for anyone who buys a property at auction. Note too that if the property is passed in at auction but contracts are exchanged afterwards on that same day, the cooling-off period still does not apply.
#In Violater.com, by default this signing of sale contract is done by KHAI KWAN under a power of attorney for both parties as agreed by both parties (seller and buyer) at the close of auction to seal the contract. #
C. Contract exchange
Exchanging sale contracts is the legal part of selling a home and happens regardless of whether you sell your property by private treaty or auction.
There will be two copies of the sale contract: one for you and one for the buyer. You each sign one copy before they are swapped or ‘exchanged’. This can be done by hand or post and is usually arranged by your solicitor, conveyancer or the agent. At the time of the exchange, the buyer will be required to pay a deposit, usually 10% of the purchase price.
# We used electronic exchange where vendors and buyers are required to click agreed online to complete this#
The contract exchange is a critical point in the sale process:
The buyer or seller is not legally bound until signed copies of the contract are exchanged;
If the agent arranges exchange of contacts, the agent must give copies of the signed contract to each party or their solicitor or conveyancer within two business days;
Buyers of residential property in NSW through private treaty usually have a cooling-off period of five working days following the exchange of contracts, during which they can withdraw from the sale;
The cooling-off period can be waived, reduced or extended by negotiation;
There is no cooling-off period for sellers. Once contracts have been exchanged, sellers are generally bound to complete the agreement; and
There is no cooling-off period when purchasing at auction.
D. Settlement
Settlement is the conclusion of the sale transaction and usually takes place about six weeks after contracts are exchanged.
