Why would I sell my property via auction?
Property auctions – it’s a concept that either fills prospective sellers with excitement or a little anxiety, and it begs the question, what are the advantages of selling your property via auction instead of private treaty?
Well let’s walk through why auctions are a popular method of sale, particularly in the current market, and how they can benefit you as the vendor.
You have control
The great thing about an auction is that it affords a balance between setting an established price while also allowing for the market to go above and beyond that minimum.
So, what do we mean? Well, as part of the auction process, you and your agent set the reserve price, which is the minimum you will accept for a property. If reserve isn’t reached, the property is passed in, and your agent then negotiates with interested parties to find a sale price that you’re happy with.
If reserve is reached, the property is then on the market, with buyers continuing to bid until someone ultimately “wins”.
In a best-case scenario this allows you to sell your property for more.
Creates competition
When it comes to making a sale, there are few better ways to create hype, excitement, and competition for your property than an auction.
Every element of the auction process is designed to gauge demand and see prospective buyers compete to call the property their own.
Swift process
Unlike a private treaty sale which has no definite end point, an auction campaign has a very clear timeline and finale.
At auction, all buyers are qualified, there are no finance clauses, pest and building clauses, etc. In other words, once the hammer falls, the sale will proceed.
It is incumbent upon the buyer to ensure all their ducks are in a row and necessary checks have been completed prior to auction day.
Full transparency
Possibly one of the greatest assets of an auction is it offers full transparency to all parties involved. Conducted in a public space, the vendor and each buyer are able to see exactly what people are willing to pay for the property.
The current market
In the current property market, auctions have emerged as the preferred method of sale for many vendors due to all the reasons above.
So why is the auction market so hot at the moment? Well right about now, interest rates are at an all-time low, people are re-evaluating their post pandemic lifestyle and housing needs, and many have a little extra cash in the bank due to the enforced savings of COVID-19.
That has resulted in pent-up property demand leading to one of the most positive auction markets seen in recent years, with the preliminary clearance rate consistently tracking above 80 per cent nationally since auctions resumed in earnest for 2021.
In other words, at least eight out of every 10 properties taken to auction is currently being sold on auction day. Some are also being sold prior, while the few which are passed in are often selling in the immediate week afterwards.
The art of auctions
Staging an auction is an art, and it’s not one suited to every vendor or every property sale. Meanwhile, the agent and auctioneer you opt for should be professionals you truly trust.
They will walk you through the auction process, highlight the pro’s and cons, offer feedback throughout the campaign, and work tirelessly on your behalf to ensure a successful sale on auction day.
In the event the property is passed in, they will then immediately draw on the auction campaign momentum to bring the highest bidders to the table and achieve the best result possible for your home.
How we can help
Considering selling your property? Why not chat with one of our friendly Eview agents to understand the state of play in your specific area. To find your local agency, click here.
