GET ACTION GO AUCTION

A hammer, wielded effectively, can often provide excellent results

THERE has been a lot of chatter over the past couple of weeks regarding the surprisingly strong activity being seen across many segments of the Cairns property market. While it isn’t quite all rainbows and unicorns for all property sectors, there are definitely price points and property types that are achieving some incredible results, even compared to pre-COVID standards.

In a market like this where we see increasing buyer interest and tight stock levels, the choice of auction as a method of sale can become more relevant. As sellers seek to make the most of competition for their homes to achieve the best price on the sharpest terms, it make sense why auctions become the most popular platform for selling property.

From a seller’s perspective, an auction campaign provides a further opportunity to crystallise interest on a single day and time, bringing together buyers in a transparent environment to bid for the chance to own the home. There’s also a reduced risk of “underselling” the property for less than someone might have paid, as it’s clear who puts their hand up the highest. The auction process also eliminates the risk of either under or over pricing the property because in Queensland at least, there’s no price guide offered.

The downside of an auction is that while an unconditional contract provides certainty, not every buyer is in a position to put their best offer forward on unconditional terms. This can potentially lock out otherwise capable buyers.

For buyers, purchasing at auction can bring mixed emotions. On the one hand, the transparency that benefits sellers also benefits purchasers – you know exactly where your competition sits and you’re all bidding on the same terms. You do, however, need to spend more time in preparation than you might otherwise for a purchase, ensuring that your finance is locked in before any bidding takes place as well as any building and pest or other requirements are fulfilled before auction day. The lack of written price guides (and this is a legal restriction) can also be a frustration but with sales data today, most buyers are able to form a reasonably educated opinion.

Auctions are not the be-all and end-all of property sales, as much as numerous dramatised reality shows s would have us believe. That said, d, they are a useful tool and one which, wielded effectively, can provide excellent results.

Just make sure it’s the right tool for your particular job.