Selling Property by Tender - All you need to know

Selling Property by Tender - All you need to know

One method of property sale that has seen increasing popularity in South Africa is sale via tender. But what exactly does this entail and what are the benefits compared to traditional property sales?

A property sale tender essentially is very similar to a silent auction. The seller is presented with bids in writing from interested buyers, which are kept in a sealed envelope until a specified date when the seller will then open and review all the offers to purchase. The offers are kept secret, which means prospective buyers are unaware of what prices competitors are submitting.

Before the offers are submitted, the property is first marketed to prospective buyers. Interested parties can then attend the scheduled viewing to assess the property before submitting their written offers. These offers can be made on conditional terms, which the seller has the option to either accept or reject. The terms and conditions of the sale will usually be stipulated by the seller in the official tender document.

One of the biggest advantages of selling your home via tender is that because the offer prices are kept confidential, interested buyers base their offers on a combination of factors, including the sale prices of other similar properties in the area and the most that they would be willing to pay. This often results in tender sales achieving better sale prices than initially expected.

For sellers who don't have a clear idea of exactly what their home should be valued at, the tender process can be an effective way to achieve true market value, especially for unusual or niche properties which offer something unique to interested buyers.

Throughout the whole process, the seller retains control and is under no obligation to accept the highest offer, although knowing this figure can be useful for opening doors to future negotiations.

All tender transactions can be completed in cash, pre approved bond or pre approved finance loan. This means the tender process is opened up to serious, willing and most importantly, financially able potential buyers.

Another significant advantage that the tender process has over typical auctions, is that it only requires one interested party, whereas auctions require at least two bidders to compete in order to drive up the price. There is also less pressure on the seller to make an immediate on-the-spot decision whether to accept the offer or not.

If you're considering selling your home via tender, contact our friendly team of Property Specialists today and let us help you to make an informed decision. Contact us on 041 581 1744 or email info@homeandhectare.com.