Why you shouldn’t be anxious about auctions

Why you shouldn’t be anxious about auctions

By Tessa Bezuidenhout on Nov 21 2016

The auction process sounds daunting and many sellers are hesitant to use this strategy when selling their house. However, auctions give the seller control over the sale process and can be a very effective way to sell your property.

By using the auction process, you’re setting the time frame in which your house is sold. With conventional selling methods, the time frame is in the buyers’ hands. But by setting a “deadline”, pressure is put on interested buyers to act quickly, often resulting in offers before the auction and a competitive environment on auction day. In a high percentage of cases, the auction process – including post-auction negotiations – result in a sale in a shorter time frame than most private treaty sales.

Auctions are considered as tests for the highest price possible in the market, and you can be reassured that you haven’t undersold the property. Buyers can also be assured that they’ve bought the property at true market value. There’s an added advantage of taking your time in setting the reserve price, basing it on feedback received from open inspections.

Auctions require a different marketing process, which builds up hype surrounding the sale of your property and potential buyers may get more excited to compete for it. “When it comes to marketing, you must leave no stone unturned.” Says David Riley, sales and marketing specialist at LJ Hooker Kenmore.

"Using print and digital marketing is necessary for the auction process to be fully effective.”

Another advantage is that the sale is absolutely final, and auction sales are cash unconditional transactions. Once that contract is signed, there are no conditions to be fulfilled and no cooling off period. If you plan on bidding at the auction, it’s recommended that you speak to a financial adviser and make sure you have finance approval before purchasing.

If your property doesn’t sell under the hammer, that doesn’t mean the end. It’s not uncommon for offers to come in after the auction is over, and your agent will communicate those to you. Your agent will also communicate with the people that were present at the auction, and are dedicated to achieving the results you expect.

Last month, the auction clearance in Queensland was 54%. And 63% of properties that didn’t sell under the hammer were sold successfully following the auction.* These numbers suggest that the marketing strategies used for auctions build up enough buyer interest to get the property sold.

Data from Core Logic