The biggest dread among vendors going to auction is that their property will be passed in the day it goes under the hammer.
Selling at a fair market value — or better — is often dependent on the extent of buyer numbers and enthusiasm.
Single-bidder auctions are starting to become common place in Australia, as vendors lose their grip on being able to secure above reserve outcomes at their auctions.
There’s a special negotiating skill needed for the listing agent to immediately secure a sale in such on-site auction circumstances.
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Of course, the agent can knock heads together during the auction, but that will take a bit of give and take from both vendor and the one buyer.
Vendors certainly need to anticipate this possibility, or one where there’s a handful of buyers who are keeping their hands in their pockets.
The question is should vendors accept the price drop on offer from the only bidder at the auction or are they best holding off selling until later Saturday afternoon or sometime in the next week.
It all depends on the level of actual and perceived buyer interest, starting from the number of contracts that have been issued in the run up to the auction.
Agents need to follow all their potential buyers closely, and keep their vendors in the loop as the auction looms.
An emerging factor has been that bank finance approvals are slower and harder to get, and many buyers are finding just days before the auction that they need to lodge more information before safely securing finance.
They necessarily sit out the auction.
This has come about as the financial regulators and the royal commission have frightened the banks so that they are dotting all the i’s and crossing every t.
Coming together for post-auction negotiations is a skill that some agents need if their vendors aren’t going to sell for far less than they wish.
The biggest myth about properties that sell after auction is that they go on to sell for a poor price.
That is not the case, given that fresh buyers are coming into the market every week.
The recent clearance rate downturn has likely undermined the benefits many see in a sale by auction, which typically come with the potential for a premium sale price.
Unmotivated sellers rarely auction their properties.
Following any post auction campaign that doesn’t end in a sale, it is important vendors respond to the issues that possibly caused it.
Best relook at price, presentation and/or marketing, and there is no reason to think it property won’t sell.
This article was first published on news.com.au.
