Why it pays sellers to hold out for auction day

HAMMER READY: 53 The Sovereign Mile, Paradise Point, will be auctioned on Tuesday, August 31, at 5.30pm with Edin Kara and Ali Mian of Ray White.

Spring selling season is upon us, but with the Gold Coast property market having been on fire since January, its unlikely we’ll notice too much difference.
A shortage of stock continues to be a problem, although some agents have reported an uptick in listings as we head into the warmer weather, but what has ramped up, however, is the number of properties coming on to the market listed for auction.
With the high ratio of demand versus supply and record sales being notched up all over the Coast, agents say that it is becoming increasingly difficult to value properties.

20 Kurrawa Ave, Broadbeach Waters, will be auctioned on September 5 at noon, through Brad Coyne of Kollosche.

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Throw a bunch of southerners, desperate to escape a life in lockdown, fast-tracking long-term plans to relocate to the Sunshine State, and who can really know just how much someone will be willing to pay?

26 Lakeview Boulevard, Mermaid Waters, will be auctioned on September 4 at 11 am through Oresti Astras and Christine Demchenko of Astras Prestige Property.

It seems logical, then, that in such unpredictable times, auctions are the best way to achieve the fairest, and hopefully best, market price.
What is perplexing, however, is the sub-trend that has emerged – the rise in pre-auction sales, where a seller accepts an offer before auction day.
Andrew Bell, principal and long-time auctioneer at Ray White said the level of pre-auction sales taking place was unprecedented.
He said in a strong market they would sell 10 to 20 per cent of properties pre auction.
“In the present market we are selling between 40 and 60 per cent of homes before auction, which just shows the incredible offers that people are making,” he said.

50 River Crescent, Broadbeach Waters, will be auctioned on October 2 at 11am through Grant Stephens of Harcourts Coastal Prestige.

Yet as tempting as these offers may appear to sellers, Mr Bell said it was crazy not to see an auction campaign through.
“Most people have a figure in mind for what they want to pay for a property and this is likely to be the offer they put forward ahead of auction. But even if it is above what a seller expects, who knows what that buyer would be willing to rise to when they are in a situation where they see others are prepared to pay more,” Mr Bell said.
“It’s not a matter of being greedy, it’s just being pragmatic,” he said.
“There are market forces at play here. There is a lot of buyers but not a lot for sale, which is a recipe for an amazing result. I cannot understand why any seller in this market would not auction their place.

734 Pacific Parade, Currumbin, will be auctioned on September 26 at 9am through Troy Dowker of Kollosche.

“But, at the end of the day, the decision is, of course, up to the seller.”
National data from Ray White shows that sellers who took their property all the way to auction day last month netted, on average, 13.04 per cent more than if they had taken a prior offer.
Mr Bell said Ray White Surfers Paradise recently had two properties sell at auction for double the reserve price, netting the sellers more than $1 million.
“It’s like winning the lottery. What seller doesn’t deserve the chance of that?” he said.

The post Why it pays sellers to hold out for auction day appeared first on realestate.com.au.

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