Selling by auction

Auction sale method. So in this case we're looking at an auction. So as you probably know this is a public unconditional sale on a set date and it's far more common sale method for houses at around 62% versus the units which where it's quite rare. And in Queensland agents cannot legally quote a price for an auction property which is exactly why our valuation guide exists on these pages to assist. From a buyer's point of view no price guidance, you get cash unconditional terms, and you're bidding in the open against other people. So it's the highest pressure format for buyers. So our data and published research shows that the old idea of auctions get more money, that there's an auction premium, that's essentially vanished in recent years. So the pressure of auctions is no longer reliably buying a seller a better result. From the seller's point of view, it buys certainty and speed. Are you getting a hard deadline, an unconditional contract, no cooling off period So the issue with auctions is that the markets really changed this year. So we've had three rate rises already this year. Demand has cooled on the Gold Coast, prices have ticked down here for the first time in years. And auction clearance rates have collapsed from around 70 % down to 24%. Sellers have really started to retreat from this method towards price private treaty methods. So auctions may be a better choice for vendors in hot markets where there's a lot of competition and where the strongest price can likely be extracted by having those competitors compete together. However, in a flat or softening market, there may be no benefit at all, even a loss. So at Fields we generally view private treaty as the better method outside of really hot markets for a couple of reasons. Firstly, research by realestate.com.au has shown that 72 % of buyers skip over homes that don't show a price. So homes going to auction are getting viewed by a far smaller pool of potential buyers than those listed by private treaty. And secondly, many homes fail to sell at auction and a study showed that those failed auction homes tend to sell just over 1% less than those that sold by a private treaty. So Brisbane auction clearance rates have collapsed from 70% last year to 24% this year so there's currently a lot of homes falling into this category that may have been better off initially listing as private treaty. Also in Queensland we have the law that there's no price guide is permitted for auction properties so the Property occupations act prohibits agents or auctioneers disclosing any price guide including a reserve on a residential auction in this state. So this becomes difficult for buyers who don't have a price guide on a property going to auction.