I have talked before in this column about the rising prominence of auction as a method of sale for property here in FNQ, and the fact that in the current market its likely to only become more popular.
Wild open homes, flurries of enquiries and multiple offers – there have definitely been worse markets to be in! What happens though, when an eager buyer just can’t wait (or bear missing out again)? You haven’t gone to market with a price, so how do you know when the price is right?
Well, feedback is critical here, both within the format of the initial sales appraisal (which probably needed an update if it was more than a month prior to launch), as well as commentary throughout the campaign. While generalised feedback can be ok, once you have identified your likely bidders, you really need to know the specifics to make the right decision.
An auction is ultimately a duel between 2 or more bidders, each seeking to own your home. Once you have passed the reserve however, it just comes down to who has their hand the highest, even if the difference between the two is minimal. One scenario in particular that lends itself to an early sale, is where there is a substantial difference between your strongest potential buyer and the rest that might see a buyer win the bidding, but a seller potentially lose out on getting the best price.
While an auctioneer might be able to entice a single strong buyer to bid more aggressively, its hard to do so when its apparent that other buyers aren’t at the same level. On the other hand, where an offer is submitted prior to auction, a prospective bidder is more likely to put their best and highest offer in first, in order to avoid potential competition under auction terms. From there, it can be a case of whose FOMO is worse – the buyer scared of missing another home in a market that seems to be running ahead of them, or the seller that doesn’t know whether they’ve missed out on potentially more money under the hammer.
My rule of thumb on making the decision? Play “what if”. Imagine its auction day, bidding has come to a stop and the agent has called you with the same number as the one on the table. Would you be happy, upset or unsure? If you can answer that one, then you know the choice to make.