Agents hammer away at auctions
Commonplace in the Eastern States property market, West Australians are now warming to auctions to buy and sell their homes.
While still a small percentage of overall sales, auctions have become increasingly popular over the past five years as the real-estate industry becomes well trained, promotes the process more heavily and the influx of home reality television shows influence viewers.
Real Estate Institute of WA auctioneering chairman David Lynch, of Peard Real Estate, said the key point of the auction process was there were three chances to sell — before, at or after auction. “During auction, interested buyers can make competitive bids which establishes the fair current market value of the property, at the time, in an open, transparent and public forum, ” he said.
“Buyers at auction can choose to increase their offer while being fully aware of their competition, as opposed to private treaty where they compete against unknown offers negotiated behind closed doors with no options at times to raise their offer.”
Three-time winner of the REIWA auctioneering championships Rob Mason, of Arthur Johnston Snowball in Albany, said selling under the hammer was not the be-all and end-all. “The belief that if it doesn’t sell at auction it is a failure and a waste of money — this is absolute rubbish, ” he said.
“Auction is a process, not a day. While selling under the hammer is the result we all want, very often the auction serves as a process for flushing out the most serious buyers with whom we can negotiate after auction.
“Most auction properties are sold within days of the auction, and if not, the seller and agent have three to four weeks of excellent market feedback to base their asking price on, for the next phase — private treaty.”
Abel McGrath director and auctioneer Barry Litten, whose agency has an 80 per cent before or under-the-hammer clearance rate, said there was a transparency and moment of truth faced by both seller and buyer on auction day.
“Buyers eyeballing each other with their egos and fear of loss at play, and sellers find out what the market thinks of their home, which can be a little daunting to say the least, ” Mr Litten said.
Mr Mason said emotion was one of the major benefits of auctions.
“Let buyers fall in love with the property first, worry about the price second, ” he said.
Mr Litten said a major plus for the seller was certainty and a short intense selling period with a deadline. “The pros are a cash unconditional sale with a pre-determined settlement date and a short, sharp, intensive campaign in about half the days on market compared with sale by private treaty, ” he said.
© The West Australian
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