Hi Forumers,
Just wondering if you can give us some of your thoughts/experiences….we’ve got 2 brand new homes side by side completing in 2 weeks so we’re obviously looking for an agent….this great agent we found is so sure that auctions are the first method of sale he would try and the normal ‘for sale’ as a back up. He said with auctions which he’s ever only had 1 passed in on because the owner decided he wanted more at the last minute, he’s sold every single one. He said with auctions, you get 3 opportunites at selling it, 1st opportunity is before the auction so for those not comfortable with auctions, they can make an offer beforehand, 2nd opp is at the auction itself and 3rd opp is the normal “for sale” method if it fails to sell at auction.
He posed the question as to why public trustee sell mostly at auction and said its because they get the best price doing it that way.
These are brand new homes…i’m confused as to which way to go because at the end of the day its our deciison whether we do auction or normal sale….has anyone had success with selling BRAND NEW homes at auction…i just think brand new homes are a little different to established homes when it comes to auction but that may just be my thing!
Any thoughts would be much appreicated as we’d like to make a decision today!
Cheers,
Kim
Kim Anand
[email protected]“Money Can’t Buy you Happiness but it Does Bring you a More Pleasant Form of Misery”
could it be because agents want more for their dollar. If they sell at auctions rather than private sales their commision is higher. Do they ever put the sellers interest first.
regards Michelle
Hi Kim
I forgot to add. If you really want to know, go around to all the realestate agents in your area and find out what they are selling newly build houses for. If you are going to put the houses up for auction make it clear to the agent what your minimum price is on each housegood luck Michelle
I would get an independant valuation done on one (if they’re both the same) or both of the properties. This will give you a good idea of what they are worth at this point in time and will also be supported by recent sales in the area.
This should give you an idea what a reasonable price would be if you go to auction. Auctions can usually result in a bidder bidding more for a house than what they may have in a normal sale, but if they have a ‘subject to finance’ clause then they can still pull out of the deal and you are back where you started minus the auction fees. I would also think that at a poorly attended auction the agent would be able to suggest that it is because the price is too high and he may try to encourage you to lower your reserve; under pressure of not selling you may give in!Ask the agent what he feels the house may go for at auction and if you think he is under/overpricing ask him what information he used to support his price. Do your own research in the meantime; you should know within a few grand, what new homes are selling for in your area and you can use this as a guide.
IMHO Julie Fisher
Daryl Fisher HomesHey Julie;
I think you’ll find that if you purchase at auction it is unconditional (may differe in some states) with no cooling off period. Another reason why agents like them.Kim;
Have a look at the Neil Jenman site and read what he has to say about auctions; he was an agent himself.The reason why the Public Trustees have auctions is because they need a result by a certain timeframe. Auctions do this; good or bad. This is the same reason why agents like them – they get a result which means they get a commission. If they don’t get a result you sell the property by private treaty anyway. May as well start there.
If you have had the homes valued and know what they are worth, then advertise them at this price and you will sell them by private treaty very quickly. If you ask top dollar you may get it, but chances are they will sit there for longer.
Do not do an auction.
Cheers,
Marc.
[email protected]“we get sent lemons; it’s up to us to make lemonade”
Originally posted by L.A Aussie:Hey Julie;
I think you’ll find that if you purchase at auction it is unconditional (may differe in some states) with no cooling off period. Another reason why agents like them.Not in Victoria! Nothing is binding until the contract is signed! Just the other day a story made the headlines of an auction ‘winner’ refusing to play-ball afterwards!
Going back a few years, a friend of my brother found this rule. He was annoyed at constantly attending auctions after being assured they were in his price range, only to have the property sell for $100k or more over the advertised price. Those were the glory-days of dummy bidding, and participants didn’t have to sign up prior… So he spent a couple of weekends attending auctions, winning, then doing a runner as soon as the crowd dispersed. Mean, but funny.
i think after reading the replies i’ve made up my mind…..i never really wanted to go down the auction path but the agent was very convincing with his theories!
Marc is right (well for SA anyway), in SA the bid is unconditional when buying at auction with no cooling off…obvsiouly isn’t the same in every other state. I think i agree with you though Marc, we have done our own valuation based on very comparable sales in the area so we know what the house is worth and the agent confirmed that today with his price guide. We’ll list a price range and sell it that way.
Thanks for everyone’s thoughts on the matter!
Cheers everyone!
Kim Anand
[email protected]“Money Can’t Buy you Happiness but it Does Bring you a More Pleasant Form of Misery”
Hi
Of course your agent wants to auction – it gives him/her a big advertising pot and a good chance of selling the property within 3 to 4 weeks, commission banked!
Selling by auction can only ever give you a result that is slightly better than second best. As soon as Mr A stops bidding then Mr B is in control, assuming there are no further bidders, Mr B wins. The problem is – you will never know how much Mr B was willing to spend because he has no one bidding against him!Ask your agent about tender. Its a sealed bid process similar to auction but its private so Mr A is likely to bid close to or at his top bid.
If you want further info please ask – i’m an agent in NZ.
jpmh[biggrin]
Hi Kim,
I think you should look at what works in your area and then decide. Some areas have strong auction history and it may be best to stick with it. Speak to few agents as well to get an idea of the fees and services offered.cheers,
Sanjiv Gupta“There is no passion to be found playing small – in settling for a life that is less than the one you are capable of living.†– Nelson Mandela
Originally posted by foundation:Originally posted by L.A Aussie:Hey Julie;
I think you’ll find that if you purchase at auction it is unconditional (may differe in some states) with no cooling off period. Another reason why agents like them.Not in Victoria! Nothing is binding until the contract is signed! Just the other day a story made the headlines of an auction ‘winner’ refusing to play-ball afterwards!
Going back a few years, a friend of my brother found this rule. He was annoyed at constantly attending auctions after being assured they were in his price range, only to have the property sell for $100k or more over the advertised price. Those were the glory-days of dummy bidding, and participants didn’t have to sign up prior… So he spent a couple of weekends attending auctions, winning, then doing a runner as soon as the crowd dispersed. Mean, but funny.
Yeh, sorry Marc, I didn’t bother to look where the post originated. I have only attended auctions in Vic. I actually got the advice about adding a clause from Neil Jenmans book where he suggested, at an auction, to insist on an escape clause being put in the contract before signing as protection. He said worst case scenario you can walk away (but not be too popular). I must say it is more aimed at people who have concerns about the house that need further investigation; not as an easy out for people who got caught up in the ‘moment’ while bidding.
To further this discussion, I would be interested in forumites comments etc on a scenario we are working through:
Commercial property advertised for sale by normal method…..price excessive at $1.65m. Realistic Price range probably $1.0 to $1.2m. Elderly Vendor is persuaded to switch to rival agency after only four weeks (even though interest being shown by a number of parties). New agent sweet talked Vendor with promise of much better outcome…….via the auction method. The cunning Sod books auction date in 4 weeks. I wonder how many potential purchasers are knocked out because of there being insufficient time to get all one’s ducks in a row as regards (for example) valuations and refinancing of other properties to tap into equity in order to flush out deposit funds in preparation for the deal.
Agent fairly loose in presenting rental details accurately…..and arrogant when discrepancies brought to his attention. Couldn’t care a toss.
Agent’s suggested solution to resolve logistics issues that we face as to timing……..put an offer in writing, if the auction comes up short, our offer could be brought into play. My instincts tell me this would just be a weapon to be used by the Agent at the point of the highest bid falling short of our offer….not to benefit us, but to get the bidder over the line for a clean deal.
Am I too cynical?
Are there any clever suggestions as to other strategies that might be considered here?
warm regards
Wilrose[thumbsupanim]
Hi Kim,
we are personally against auctions. They may not get passed in but they dont always get the best price.
Private treaty or selling with option to purchase is our preferred methods, one achives a good price and the other achieves the BEST price! [biggrin]Investment Property Management
http://www.adprop.com.au
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