There's been recent media attention around real estate auctions, which doesn't give all the information about the auction process. The way these stories were conveyed may cause those considering auction, to understandably question or dismiss the auction option.
The articles only reported part of the facts. What they didn't highlight is that it's only natural that as market volumes move up and down so do the volume of auctions. Fewer homes sold, will mean fewer auctions. The articles also only report the results of a handful of companies and implied that the Auckland and BOP markets showed similar auction results. They also failed to take into account the number of properties that have received bids at auction or post auction offers.
The articles also excluded the number of properties sold post auction, to buyers who weren't in a position to bid on auction day. The reality is that these transactions are as important and as much of part of the auction process as those sold on auction day.
The auction process is simply a three-phased approach. Designed to give sellers the best chance to achieve the price they want and as many buyers as possible the chance to buy the home they want:
- Phase one identifies all potential buyers.
- Phase two allows the seller to work with those able to bid on auction day.
- Phase three allows those not able to bid to enter into negotiations with the owner on a conditional or unconditional basis should the property be still available.