The 2023 PropTrack Off-Market Sales Performance Report has found that, on average, houses that sold off-market achieved a sales price 4.3% lower than those listed online. Off-market unit sales also delivered 1.2% less on average.
Prop-Track senior economist Paul Ryan said in some areas that can be a price difference of more than $60,000. Real estate agents say that in some cases, listing online can add hundreds of thousands – or even millions of dollars – to the final sale price!
The data compared the sale prices of properties that sold off-market over 2022 against those that were listed on realestate.com.au.
Mr Ryan said “While some sellers might try to save money by not advertising online, this analysis shows the potential earnings lost in the final sale price far outweighs the initial cost of advertising. The result of this research suggests that sellers, on average, will achieve better total outcome by listing their property online with a public selling campaign.”
Melbourne real estate agent and auctioneer Simone Chin estimates around 80-90% of sellers who start an off-market campaign go on to achieve a better result by listing their property online. Ms Chin said, “People sometimes try to do it just quietly at the start, but it doesn’t yield as great a result or as frequent results as perhaps some in the industry may wish people to think.”
She said limiting the buyer pool can leave a lot on the table, particularly in the current market. “It’s a bit like you’re trying to sell a secret, and you might only have three buyers looking at it, instead of 100 which is much better for your price.”
“You would be going to an historical active buyer, someone that an agent has met in the last quarter or the last 12 months and it’s missing out the whole raft of new buyers that we know come in every 45 days or so, which is where the exposure on the internet is so strong and powerful,” Ms Chin said.
“Not only are those buyers picked up on a regular basis as the cycles move through but there’s also eyes overseas, there are expats, there are people who have not perhaps engaged with going to see inspections, but they’re doing their research online.”
A strong marketing campaign and heated competition for the right property will undoubtably lead to the maximum price for home owners.
The Inconvenience Factor
Some sellers can be reluctant to go through an online selling campaign due to the “inconvenience factor”. This is also a line pushed by some real estate agents not wanting to do the hard work involved in running a full advertising campaign.
The inconvenience of having weekly open homes and having to keep the property clean and tidy week in and week out can be front of mind for people. However, allowing buyers to see their competition at an open home can be a game changer and will usually get a significantly higher price for the property.
The Cost Factor
Some agents will push an off-market sale by saying it will save the seller thousands of dollars….but at what cost to your final sale price.
To list a property as a “Premiere” on realestate.com.au costs $2,139 or $199 for a standard ad (remembering agents are not allowed to profit from advertising).
A Premiere listing:
- Has 5.5 times more email enquiries and sells 49% quicker than a standard listing;
- 56% of consumers don’t look beyond the first page of realestate.com.au;
- Rotates to the top of searches every 15 days; and
- Will be seen first by more buyers as it’s at the top of search results.
So, is it REALLY worth the risk to sell off-market?
In some instances an off-market sale is necessary for various reason. However, for the inconvenience of open homes and the cost of a few thousand dollars in advertising, is it really worth the risk of:
- Not putting the property in front of a huge range of buyers;
- Not creating competition between buyers at an open home; and
- The possibility of under-selling your property by tens of thousands of dollars?
A great agent will always do what is right for their sellers, not what is the easiest and quickest transaction for themselves. If an agent is pushing you for an off-market sale, ask yourself why? before you sign anything.
Remember, if you are thinking of selling, if you need any help or advice, or would just like an updated appraisal for your property, I am just a phone call away.
All the best, Simon
Source: Realestate.com.au PropTrack