Taking a home to auction can be a very successful way to sell a property, but not every property taken to auction sells under the hammer.
Often, the dwelling might be passed in – meaning the reserve price has not been met and therefore the property has not managed to sell at the auction. However, this does not necessarily mean the property will not sell on the day – in many cases, the highest bidder will be taken inside for further negotiations and the property may sell straight afterwards.
Speaking with West Real Estate, The Agency Licensed Agent and Licensed Auctioneer Mitch Watt said a property could be passed in for a number of reasons which were not related to the property itself.
“It’s easy for emotions to be high after your expectations aren’t met at the auction, but it’s important to approach the negotiation rationally,” he said.
“Often the property will receive offers immediately after the auction from buyers present who were unable to bid due to not being in a cash position, such as people who need to sell to buy or gain finance – I have seen this happen at my own auctions on a number of occasions.”
For sellers going to auction, Mr Watt said to be realistic with your price expectations and invest in good marketing.
“Also, choose a consultant who is well experienced in the auction process,” he said.
“Anyone can advertise an auction, however a thorough understanding of the three-phase process is needed by the consultant to achieve the best result, and this can only be gained through experience.”
For buyers attending an auction, Mr Watt said to make sure you were in a cash position.
“Know your limit and stick to it, being in a cash position may mean you are the only bidder,” he said.
“Do your research on what to expect on the day and you will be more comfortable, and bid with confidence.”
Given the overall concern for the economy because of the global pandemic, Mr Watt said there had been less auctions for obvious reasons.
“For some time we were not allowed to even do home opens, much less gather 30 or 40 people in close proximity for an auction,” he said.
“If an auction is well run there should be no difference, the property should sell in a timely manner even if it is in phase three – post auction.
“Typically, the auction process means you will be more likely to achieve a sale and in a more timely manner. One of the key benefits of auction is it creates a sense of urgency, something that is entirely lacking in most other methods of sale.”