What is said here is most important for those selling hotels today:
'LAST RESORT' MARKETING NOT A REAL OPTION
There is a lot of misunderstanding in many sections of the community
about the use of Public Auction as a mop-up marketing strategy. Many home
owners think that Auction is a great 'last resort' selling strategy - the
ultimate eraser of past marketing mistakes and righter of all poor
decisions made in their earlier Private Treaty marketing. While it is
true that many vendors go to Auction after failing to sell by Private
Treaty, it is not hard to work out the flaw in this argument.
Vendors often think they will try to market their property by Private
Treaty at an inflated price just to see what happens. When asked for an
explanation, many say 'Oh, if I don't get my price I can always auction
it.' But what happens at Auction when months of marketing at an inflated
price haven't secured the dream price the vendor was looking for?
Sadly, by the time the vendor has given up on Private Treaty, the
property is likely to be over-exposed and it will attract bargain
hunters, no matter what method of sale is used. Valuable time has been
lost, and unless the market is trending up, the sale price is likely to
be lower than if it had sold more quickly.
Once a property has been on the market for a long time, buyer interest
falls. Auctioning at this point rarely creates the competition needed for
a high price. Buyers know the vendor is unrealistic and often stay away
from the auction - a death knell to hot bidding. The best case scenario
is that the auction will attract bargain hunters - another great way of
keeping the price down.
In reality, no method, used as a last resort, will deliver optimum
results. Holding out for an inflated price, no matter which marketing
method a vendor starts with, will usually end badly - no matter how good
the 'last resort' selling technique of choice is. There is no safety net
fix-it strategy for selling over-exposed properties.
Whichever method a vendor chooses to sell their property, it is important
they do proper research into the market in their location and set the
reserve (auction) or the asking price (Private Treaty) so that the
property sells within the first month or so of marketing. 'Last resort'
options shouldn't be in the vocabulary of a home seller who wants to get
the highest price for their property and they certainly don't replace
realistic response to market conditions and a firm hold on the reality of
price expectations.
