Exclusive and Sole Listing
This form of selling is considered the traditional way. The agent shows your property to prospective buyers by way of private viewings and open homes. The prospective buyer will then make an offer and negotiations will commence.
Unlike the auction process, the seller does not have to agree to the buyer’s terms and vice versa. By signing an exclusive or sole listing agreement you are giving the right to sell the property only to the agent/s named on the listing form.
By listing exclusively or solely with an agent you give them a certain amount of security which encourages them to work harder because they know their hard work will pay off.
All real estate agencies reward their sales staff with a higher rate of commission for the sale of an exclusive or sole listing. This in turn means that an agent will focus more on their exclusive and sole listings.
Having one agent exclusively marketing your property gives the seller a greater degree of control over the sales process. It is much easier to organise inspection times and conduct negotiations when dealing with one agent. It avoids conflicting opinions and allows the seller to form a partnership with their agent.
Open Listing
This form of selling your property is where you let multiple agents market and sell your property. A common misconception is that you have multiple agents working very hard to sell your home. The unfortunate truth is that exclusive listings receive priority as the sellers have made a commitment to the agent who in turn gives that property their full attention. As an example – you invite four painters to come and paint one wall each of your bedroom and you tell them that the one who does the best job will get paid for the whole job. How many painters do you think will show up to do the job?
All real estate agencies reward their sales staff with higher percentage of commission on a sale of an exclusive or sole listing. This translates to agents giving higher priority to exclusive and sole listings over open listings.
Once again exclusive and sole listings do get more exposure but this does not mean to say the open listing gets ignored or pushed to the back of the queue when it comes to promoting properties.
Informal Tender
Where an interested party submits an offer usually by an Offer To Purchase document. Often there is no end date to an Informal Tender. It is the equivalent of an Expressions Of Interest. Informal Tenders are a way of testing the market.
Formal Tender
Where all interested parties must complete a contract of sale to submit an offer. The Tenders are received in a sealed envelope and placed in a locked box which is not opened until the closing date has been reached. This ensures that no one is aware of any other parties Tender until the Tenders are opened, and removes any suggestions of favouritism to any party. A Formal Tender process allows the Vendor’s to stipulate prior to commencement, any terms and conditions they may require, e.g. a specific time for settlement, or not subject to finance etc.
