A process of selling, calling for purchasers to make their best offers in writing for that property by a given date.
The tender works in a similar way to the auction system, except there is no public auction day. Instead, tenders or offers close at a specific time on a specific date.
Tender presents another opportunity for sellers to create a competitive situation without stating a listed price. They set the terms, conditions and the deadline, and prospective buyers have only one opportunity to put forward their most competitive offer.
Like auction, tender increases the number of enquiries, inspections and opportunities to obtain the very best price for the property. Also, the seller doesn't necessarily have to accept the highest price. They can choose to negotiate with any of the tenderers to achieve a satisfactory conclusion.
The tender process
1. When sellers offer their property for sale by tender, everyone with an interest to purchase must put in their offer on a normal Sale & Purchase Agreement/Contract or a specially prepared tender document.
2. These offers are sealed in an envelope and deposited in a tender box, by a predetermined date and time.
3. All tenders are held by the consultant or someone appointed by the seller until the close-off date.
4. They are then opened together, allowing the seller to choose the most favourable offer.
5. A time frame is often given for those offers to be considered.
Benefits to the seller
• All offers and negotiations are confidential.
• The seller sets the terms, conditions and deadline.
• The tender-oriented target marketing draws attention to the property, adding a competitive edge that strongly favours the seller.
• You do not overprice or undersell the property; instead you let the market and individual buyers determine the value.
• The `no price' aspect will attract more genuinely interested buyers.
• In the case of an open tender the seller may decide to accept a cash offer prior to the tender date.
• If the property is not sold by the tender date, it will be exposed on the open market as an exclusive listing.
• A high level of service and feedback by their sales consultant.
• The seller has the option of choosing not to sell to a particular buyer.
• A set tender date allows the buyer to better plan and arrange finance, sell their existing property, organise a property check, familiarise themselves with all the tender documents and consult their solicitor.
• They can submit an offer for consideration prior to the tender date.
• If the property is not sold on the tender date, their sales consultant can help them enter into negotiations.
• Offers do not have to be cash; they can have conditions of sale attached.