Realtor uses a no-reserve auction to sell house

The property which is for auction with no reserve. Photo / Supplied

He may be disregarding all the industry advice, but estate agent Trevor Palmer is taking his chances and selling his Hamilton property at a no-reserve auction.

Mr Palmer believes it is the first time the sale method has been used in the city.

The 1960s brick, three-bedroom rental at 1 Rhode St in Frankton, with a 477sq m section and large garage, has a capital value of $240,000. Properties in Frankton are generally selling around the CV.

Mr Palmer, of Lodge Real Estate in Rototuna, said some of his colleagues thought he was crazy but he had not seen it done in Hamilton in his 16 years in the industry and was interested to see how it went.

"Some of them think I'm mad and it's surprising some of them don't understand the concept, which quite surprised me. They are sort of going: 'Yeah, okay, but what do you want for it?' I'm thinking, 'Hey, it doesn't matter what I want. It's a no-reserve so the highest bid will get it.'

"I don't want to put a figure in there because it will scare people off. Feedback coming in is about $200,000 but it doesn't owe me much so that's why it doesn't really matter what I get for it."

So far only two buyers had confirmed they would be bidding at the September 12 auction, but Mr Palmer was hopeful more would turn up on the day.

Real Estate Institute of New Zealand chief executive Helen O'Sullivan said an auction with no reserve was a very unusual marketing technique.

"It's not something I would recommend to the average vendor," she said. "It's a huge risk but I guess if you're a bargain hunter why wouldn't you turn up - you might get it for a ridiculous price."