Auction vs private treaty vs tender: how to choose how to sell your home in Australia
Three sale methods, three different costs, three different risk profiles — and one common mistake most sellers make before they pick. Here's what each method actually is, when it works, and where the word "tender" gets confusing.
Published 22 April 2026 · Updated 22 April 2026 · ~7 minute read
Before you pick a real estate agent, you need to decide how your property will be sold. In Australia there are three sale methods in common use: private treaty (the most common), auction (the most publicly known), and tender (the most misunderstood). Each has different up-front costs, different campaign timelines, and a different shape of risk.
There is also a fourth thing called "tender" that is not a sale method at all — it's the process of choosing an agent, which is what Tender My Listing offers. We'll get to why that distinction matters.
Private treaty — the Australian default
A private treaty sale is a negotiated private sale at an advertised asking price. The agent lists the property, buyers inspect it, buyers make offers privately, the seller accepts or counters, contracts are exchanged, and a cooling-off period applies. Roughly three out of four Australian residential sales happen this way.
When it works: standard suburban homes, markets with moderate buyer depth, sellers who want flexibility on price and timing, and sellers who prefer negotiations to happen out of the public eye.
When it doesn't: in very hot markets with many interested buyers, private treaty can leave money on the table — a single buyer's first offer becomes the seller's anchor, and the agent has no mechanism to turn competing buyers into a bidding contest.
Costs: agent commission (typically 1.8–2.8% of the sale price), marketing ($2,000–$6,000 for a standard campaign), conveyancing ($1,500–$2,500), and mortgage discharge fees.
Auction — public competition on a set day
An auction is a public competitive-bidding event on a named date, usually held at the property itself. Buyers register, bid in the open, and the highest bid above the seller's reserve wins. The winning buyer signs the contract on the spot. No cooling-off period. The campaign usually runs 3–4 weeks beforehand, with a set number of open inspections.
When it works: high-demand markets with many buyers, scarce or unique properties, properties without an obvious comparable (where an asking price is hard to set), and sellers who want a clear deadline. Sydney and inner Melbourne use auction far more than other capitals.
When it doesn't: if bidding is thin, the property passes in and becomes "damaged goods" in the buyer's mind. In cooler markets, the expense of a four-week auction campaign can be wasted if the reserve isn't met.
Costs: agent commission (often slightly higher than private treaty — 2.0–3.0%), marketing ($4,000–$10,000 for a proper auction campaign), auctioneer fee ($500–$1,500), conveyancing, and mortgage discharge fees. Expect 3–4% of sale price in total selling costs.
Tender (buyer tender) — the rare one
A buyer tender is a sealed-bid process: buyers submit a single best offer by a published deadline, and the seller picks the strongest offer or rejects all. There's no public bidding. It's uncommon in standard residential, more common in prestige or off-market sales where vendors want to control who sees the property and on what terms.
When it works: prestige property, off-market sales, development sites, or any scenario where the vendor wants serious offers only and is prepared to reject a weak field.
When it doesn't: anywhere the buyer pool is not sophisticated or not large enough. Most suburban sellers should skip this method.
Tender (agent tender) — not a sale method
This is the word "tender" that confuses people the most. An agent tender is a process for choosing which agent will sell your property, not a process for choosing a buyer. Instead of meeting three agents one at a time for free appraisals and picking the one you liked best, you invite multiple agents to submit a sealed proposal with their commission rate, marketing budget, and sales strategy.
Tenders are blind — agents can't see what the others bid. That head-to-head competition pulls commission rates down by 0.4 to 0.8 percentage points versus one-on-one negotiation — roughly $4,000 to $8,000 saved on a $1 million sale.
An agent tender does not replace auction or private treaty. Once you've picked your winning agent, they sell your property via whichever method you both agree on. The tender is the pre-listing step. See how Tender My Listing's agent tender works →
How to decide
The decision between auction and private treaty should be made with the agent who knows your suburb best, not in a vacuum. A good agent will tell you honestly whether the buyer pool in your postcode supports an auction, or whether private treaty will produce a better outcome with less marketing spend.
But here's the trap: that advice can come from the agent with the highest commission or the biggest marketing upsell. That's why it pays to compare multiple agents' views side-by-side before committing. If three local agents independently tell you "private treaty will outperform auction in your suburb", that's a strong signal. If two say auction and one says private treaty, dig into why — the dissent might be a better read of the current market, or it might be an agent less familiar with your patch.
Running an agent tender before picking a sale method gives you this comparison automatically. Each agent proposes their recommended method, their commission, their marketing plan, and their expected sale range. You choose the agent whose plan makes the most sense for your property.
Total cost to sell, by method
| Method | Agent commission (typical) | Marketing | Other | Total on $1M sale |
|---|---|---|---|---|
| Private treaty | 1.8–2.8% | $2k–$6k | $2k–$3k | $22k–$37k |
| Auction | 2.0–3.0% | $4k–$10k | $2.5k–$4.5k | $26k–$44k |
| Agent tender + private treaty | 1.4–2.2% (competitive) | $2k–$6k | $2k–$3k | $18k–$31k |
| Agent tender + auction | 1.6–2.4% (competitive) | $4k–$10k | $2.5k–$4.5k | $22k–$38k |
Ranges are indicative only and vary by state and suburb. Tender My Listing commission ranges reflect the typical bid spread when 4–5 agents compete head-to-head; actual tenders vary by suburb and agent.
Frequently asked questions
What is the most common way to sell a house in Australia?
Private treaty — a negotiated private sale at an advertised asking price — accounts for roughly three out of four residential sales nationally. Auction is more common in Sydney and Melbourne than in other capitals; tender (of the buyer variety) is rare in standard residential.
Is auction better than private treaty?
Not automatically. Auction tends to produce higher prices in hot markets with many interested buyers and scarce stock. In a cooler or thin market, auction can produce a below-reserve result or a pass-in, while private treaty gives the seller time to negotiate. The right method depends on buyer demand in your suburb, not on a blanket rule.
What is a tender when selling a house?
Confusingly, "tender" is used two ways in Australian real estate. (1) A buyer tender is a sealed-bid process where buyers submit a single best offer by a deadline — uncommon in residential. (2) An agent tender (what Tender My Listing offers) is a sealed-proposal process where agents — not buyers — compete for the right to sell your property. The two are unrelated.
How much does it cost to sell a house in Australia?
Agent commission (1.8–2.8% of the sale price for most capitals) is the largest variable cost. Add marketing ($2,000–$10,000 depending on campaign), conveyancing ($1,500–$3,000), auctioneer fee if auctioning ($500–$1,500), and mortgage discharge and council adjustments. Total selling costs typically run 2.5–4% of the sale price.
Does an agent tender replace an auction or private treaty?
No. An agent tender is the upstream step of choosing which agent will represent you. The winning agent then sells your property via auction or private treaty (or both, or expression of interest), as you and they agree.
Can I negotiate a lower commission without going to auction?
Yes. Most agents will negotiate their commission, especially if they know you are comparing multiple agents. Head-to-head comparison is the most reliable way to see real commission ranges — one-on-one negotiation tends to anchor around the agent's opening rate.
Which sale method gets the highest price?
There is no method that wins on average. What drives price is buyer depth in your suburb, the property's condition and staging, the quality of the campaign, and the skill of the agent. Pick the method that exposes your property to the most qualified buyers for the budget you have.
Decide on a method by hearing what five local agents actually propose
Instead of picking a sale method in a vacuum, invite five local agents to tender. Each will propose the method they recommend, their commission, and their marketing plan — side-by-side, apples-to-apples.
Invite agents to tender →