Auctions still the best way to find committed buyers

Auctions are still the best way for committed sellers to attract buyers, no matter the state of the market. An auction sends a direct signal to buyers that a vendor is committed to selling a home, even in challenging times. It also gives people confidence they are paying fair market value for a home.

Raine & Horne Crows Nest recently sold a two-bedroom, one-bathroom semi-detached home at 81 West Street, Crows Nest, for a price significantly above expectations at $1.125 million. David Hill, principal of Raine & Horne Crows Nest, notes that the West Street auction was attended by 100 people, with six registered bidders. “We realised the property would be popular, while the owner’s commitment to sell, made this a good property to take to auction,” he says.

It is true auction campaigns are popular when the property market is robust, but it can also work in softer markets. This is because with an auction there is a defined timeline built around the sale of a property which is appealing to serious buyers.

This often makes the auction process a sensible choice when the market is dropping, because it restricts the selling timeframes.

Many auctions result in a sale, even if not immediately on auction day. Although a property may not always sell under the hammer, it is rare that we would not sell all of our auction listings within one or two weeks after the auction process. In fact, the best agents and auctioneers are working together with buyers to set a platform for the property to sell immediately after auction, and this is where we are seeing most of the activity at the moment.

In a market where agents face the challenge of matching sellers with buyers, auctions provide the vital middle ground. This is because many buyers are seeking a bargain, while a significant number of owners are still hoping their property is worth the same amount as 12 months ago. There are plenty of buyers in the market, and auctions can bring these buyers together with an owner to agree on a price. This doesn’t happen when you have one buyer and one owner, as is often the case with a private treaty sale.

Where properties don’t sell at auction, this is because the owner has set an unrealistic price, or there are some due diligence issues for buyers to sift through. However, those listings that typically sell well at auction include straightforward properties, such as freestanding homes in good streets with single tenants.