Why on-market sales of investment properties get the best results

When it comes time to cash in on an investment property, some agents will suggest selling off-market to save money on marketing and time with open homes. But most will be adamant: selling on-market is the best way to maximise price.

“To get the highest price, you always need to attract the broadest range of buyers,” advises Michael Pell, managing director of investment property national buyers agency Propell Property.

“It’s vital to attract multiple bidders to drive up the price at auction, or the most interest at the highest price at private treaty. So, it’s vital to have your property looking as good as possible and marketed well to bring in the owner-occupiers who are emotional buyers and pay the most.”

While Pell, in his role as a buyers’ agent, likes purchasing off-market, where bargains can sometimes be found, he would never recommend selling that way. He understands why some owner-occupiers do it – to preserve their privacy and avoid neighbours sticky-beaking through their homes – but he sees no upside for investor vendors.

“You’re just much more likely to get a good price on-market,” he says.     

Most investors, of course, hold onto property for the long term to make the most of capital growth and rental yields, but sometimes there are great opportunities to sell when, perhaps, there’s a shortage of particular types of property in a sought-after area or investors want to trade up.

Michael Yardney, chief executive of Metropole Property Strategists, also believes that, in those circumstances, selling on-market is the only way to go. “It all comes down to one thing: you can’t sell a secret,” he says.

“You have one chance to get the best price for a property and – as it’s still a sellers’ market in most areas around Australia – you need to present the property well, have good photos, undergo an excellent marketing campaign, create some FOMO and attract a range of buyers to compete on price.

“Some agents might have a strategy of suggesting selling off-market to get a listing by promising that the vendor will have to spend less money, but that’s usually a false economy. You want the right presentation and right promotion to get the right price.”

Head of Ray White’s national performance and recognition team Bianca Denham is another who’s adamant that investors should look only at selling on-market if they want to achieve a premium price.    

“That can be more difficult if you have a tenant in place, but it’s still always the best option,” she says. “The problem with sales off-market is that you never know if you’re getting the best price as it’s reaching such a limited pool of potential buyers.

“Really, you should always go on-market as you want to capture the whole of the market and the only way you can be sure of doing that is by advertising it as widely as possible on digital media, print media and the social platforms, all channels. You need to present it well and market it competitively for the best price.”

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