Tussling for a dream property either on location or in a professional auction room surrounded by other nervous buyers may impact how buyers connect with a property, but one of the country’s lead auctioneers says it won’t change the price.
Despite auction numbers being significantly down on last year, auctioneers told OneRoof they still believe it’s the best method of sale in the first instance.
But should the auction take place in their agency’s room or yours?
Ray White lead auctioneer Sam Steele said in-room auctions tend to be more popular in New Zealand due to their ease of use for the public and the fact that they are held in professional auction rooms with all facilities available including toilets, parking, live streaming and meeting rooms.
Start your property search
Steele said selling a property in an auction room at the same time as a number of other properties gets it exposed to a large crowd of active bidders and often buyers who might miss out on their first choice of property end up bidding on another property that comes up later in the line-up.
Although other property owners opt for onsite auctions to showcase the property’s uniqueness or view and because they feel it increases the buyers’ emotional attachment to the property.
But onsite auctions are not just used for high-end homes and Steele has auctioned off units for $200,000 through to high-end luxury properties. In some cases the auctioneer fee could be slightly higher for an onsite auction, he added.
Harcourts national auction manager Shane Cortese said a lot more auctions are being held in-room at the moment due to the dicey weather and fewer bidders around.
With eight to nine properties being called at the same session, in-room auctions usually have good turnouts whereas that is not always guaranteed at an onsite auction, especially if the weather turns bad.
Cortese auctioned four properties onsite on Sunday including a beautiful home in Schnapper Rock and said the wet weather made it more challenging for him as he went through two suits on the day and thinks it impacted how many people turned up to watch.
A four-bedroom home on Tamihana Avenue, in Fairfield, Hamilton, passed in at auction last week and is now priced at $1.799m. Photo / Supplied
Weather aside, Cortese said some agents preferred holding auctions at the property itself so people can see what they are bidding on.
“They love onsite because they feel like it’s like a showroom. You get to touch the furniture, touch the wall – you get to see what you are getting. But I think by the time you go to auction the people are going to be there anyway.”
However where the auction is held, Cortese said, doesn’t seem to have any bearing on the final sales price.
“I haven’t seen a massive difference between onsite and in rooms as far as property pricing goes. It’s just a choice. Some owners, some vendors and some agents prefer to be in rooms, some prefer to be onsite and you have to be adaptable to them both. It’s about having more than one meal on the menu basically and being able to offer what you want to have.”
Lodge managing director and auctioneer Jeremy O’Rourke said his Hamilton-based agency usually only holds auctions onsite when it would be sure to create some “street theatre”.
They are used for properties that are guaranteed to attract a really good crowd to elicit that emotion and bring out the best bidding in the buyer, he said.
“That doesn’t happen in backyards generally, that happens [on] street frontage – it is street theatre that gets people excited about it.
Ray White auctioneer Ted Ingram sets a fast pace for auctions at Ray White Auckland Central earlier this year. Photo / Fiona Goodall
“You get the excitement of the neighbours who love living in the area and that adds emotion to it so when you get people bidding, they do understand the value of the community.”
Just this week O’Rourke called an onsite auction on the front lawn of 14 Tamihana Avenue in Fairfield. The “picturesque” property passed in despite the property creating a lot of interest and now has an asking price of $1.799 million.
Other houses are better suited to an auction room, he said, because there is usually a reasonable crowd due to multiples properties being sold at the same time.
Onsite auctions are also something Ray White Mount Maunganui and Papamoa salesperson Quintin Havenga uses for properties with the "wow factor".
"I don't do it for every single property, but definitely for properties which I've described as having the wow factor or something unique. I believe there's a bit more of an emotional connection for people to be onsite. When they are bidding, they can actually relate with what they are bidding on, what is in front of their eyes."
At the end of September, a lifestyle property on Rogers Road in Pukehina sold onsite and attracted a lot of interest with two bidders going head-to-head for it on auction day. The property eventually sold under the hammer for $3.3m, breaking the record for the area.
Havenga believes having the auction at the Rogers Road property helped get the best result and there had also been a lot of support from neighbours. Those who couldn't attend in person, could still watch it online.
Most of the properties he sells are going to auction because he thinks it helps find unconditional buyers in the first instance, but the majority are called in-room due to the ease and convenience for people.
Christchurch-based Harcourts agent Zani Polson also favours in-room auctions and believes the atmosphere, sound quality and set-up is better. They are also usually quicker.
“Unless the house has an amazing view or something like that. There has been the odd one where people will do it if it’s a brought forward auction because you know it’s going to sell.
Last week more than half of the properties up for sale sold at Harcourts Holmwood’s auction and Polson said there was a lot of excitement in the room.
“Buyers don’t want to go in and feel scared in the first instance when they are going into buy, but if they see other people are bidding then they also get confidence to bid.”
