Agent wants reserve price in writing before auction

[Macca]

Perhaps you could have a look around this site

<<Reserve price

The property officially becomes ´on the market´ when bidding reaches or exceeds the reserve price.

If bidding does not reach the reserve price, then the highest bidder usually has the right to negotiate to buy after the auction.

If the vendor does not set a reserve, the property is on the market from the first bid.

You should also advise vendors that you cannot accept a bid from them if they have not set a reserve, or the reserve is exceeded.>>

http://www.fairtrading.qld.gov.au/auction-reserve-prices.htm

 

[Ed Barton]

I think the more strategic question is what you are going to do with your vendor bid (if required).... whether your vendor bid will go straight to reserve (or even over it), or just take a "step" up to the price. We had a few properties go to auction. If there is not alot of bidding, or the bidding is very low, then I would suggest using the vendor bid to go over your reserve, so when people ask about the auction results, the agent can say 'it was passed in at ***' (and most people dont realise the amount is actually a vendor bid)

Do you know if there are registered bidders? Its a hard time to be having an auction.

you get more than one vendor bid in QLD.

 

[shuggy]

Thanks Macca, exactly the sort of info i was trying to locate . Have sent agent the reserve, fingers crossed.

 

[Jacque]

Best of luck with it Shuggy

 

[shuggy]

Thanks Jacque

 

[Peterw]

In relation the a vendors bid, in QLD, and I think it is the same in most states, it must be declared, in such a manner that every one clearly understand it to be a vendors bid. Here is the situation with vendors bids and the reserve:-
http://www.fairtrading.qld.gov.au/auction-bidding.htm
Good luck, and let us know the outcome.

 

[Peterw]

Well Shuggy, what was the outcome?

 

[shuggy]

Passed in
http://m.realestate.com.au/property-unitblock-qld-labrador-108105806

 

[wylie]

Ahhh!! That is the block you suggested was a good buy with good return in a recent thread of mine. You didn't say at the time that you were the vendor (but it did cross my mind).

I liked the return and we went and looked at it one day when we were heading to the coast. The agent wouldn't give us any information about price, which is a good thing for you as the vendor.

He wanted us to tell him what it was worth. I told him that we have no idea as it would be the first such place we have seen, and asked him again what sort of prices were prospective purchasers telling him, ballpark. I think I asked him if it was going to go under $1M? He wouldn't even give up that information.

I found it frustrating because if he had at least given us some idea of what people were saying, we might have taken it further, but he lost us by not giving any idea at all of price away, telling us twice that he wanted to know what we thought it was worth. I told him twice we were clueless. Perhaps he didn't know but I would guess he has seen many more similar properties than us.

I realise we could have done our own research into sold properties, but he could have sent us recent comparables, but he didn't do that.

Anyway, would be curious to know what sort of figure you are looking for?

 

[Peterw]

Shuggy, would you mind sharing how the bidding went etc

 

[shuggy]

Thanks wylie, that was great feedback from a prospective buyers' point of view -- you're like my secret shopper I did make a disclaimer in that thread but sorry if i mislead you ... FYI, i've asked the agent to list it at $1.15m but of course it's negotiable like everything in life. Rent is $72,540, rates and building insurance is about $7,500 pa so net yield is about 6.5% based on $1m .. better than what the bank will pay especially after todays rate cut.

Peter there were 3 registered bidders on the day but only 1 bid so it was passed in. Have had 4 offers since then but none worth considering. The next 1-2 weeks will determine whether it's to be held or not.

 

[Jacque]

I liked the return and we went and looked at it one day when we were heading to the coast. The agent wouldn't give us any information about price, which is a good thing for you as the vendor.

I beg to differ here that such practices are "good" for the vendor, Wylie- after your comments below, do you think you would have considered it if the agent had have replied "Over $1m" to your question?

He wanted us to tell him what it was worth. I told him that we have no idea as it would be the first such place we have seen, and asked him again what sort of prices were prospective purchasers telling him, ballpark. I think I asked him if it was going to go under $1M? He wouldn't even give up that information.

I found it frustrating because if he had at least given us some idea of what people were saying, we might have taken it further, but he lost us by not giving any idea at all of price away, telling us twice that he wanted to know what we thought it was worth. I told him twice we were clueless. Perhaps he didn't know but I would guess he has seen many more similar properties than us.

I realise we could have done our own research into sold properties, but he could have sent us recent comparables, but he didn't do that.

Anyway, would be curious to know what sort of figure you are looking for?

The trouble with so much ambiguity around prices is that vendors and agents not only lose buyers such as yourself but they serve to alienate the genuine buyers as they assume that the property is out of their grasp altogether. Unless you have a highly unique property (that even a selling agent has trouble pricing) I fail to see the method in the madness of not providing buyers with some guide, at the very least. Not every buyer knows the market as intimately as the selling agent believes they should, neither do they want to necessarily spend the resources and money pursuing something that was never in their reach in the first place.

As you've pointed out, Wylie, the whole process becomes very frustrating and really doesn't benefit any of the parties involved- vendor, agent or buyer.

Shuggy, best of luck with your impending sale. Now that you've been through the process, is there anything you'd do differently at all?

 

[Jaggannath]

I beg to differ here that such practices are "good" for the vendor, Wylie- after your comments below, do you think you would have considered it if the agent had have replied "Over $1m" to your question?

The trouble with so much ambiguity around prices is that vendors and agents not only lose buyers such as yourself but they serve to alienate the genuine buyers as they assume that the property is out of their grasp altogether. Unless you have a highly unique property (that even a selling agent has trouble pricing) I fail to see the method in the madness of not providing buyers with some guide, at the very least. Not every buyer knows the market as intimately as the selling agent believes they should, neither do they want to necessarily want to spend the resources and money pursuing something that was never in their reach in the first place.

As you've pointed out, Wylie, the whole process becomes very frustrating and really doesn't benefit any of the parties involved- vendor, agent or buyer.

Couldn't agree more. If an agent wants to play coy/games with me, I'll quickly lose interest. I don't care whether he's trying to assess the bidders, just tell me how much and if I'm interested at that price I'll turn up. It's like an agent who tried to convince me in-room auctions were a good idea. I asked her target market, she said it was people like me (mid 20's, wanting to renovate), and I told her neither me nor three of my friends who were looking at the time bother to attend. If it sells, too bad, and if it doesn't I can make an offer afterwards, but turning up is often a waste of time.

 

[wylie]

I beg to differ here that such practices are "good" for the vendor, Wylie- after your comments below, do you think you would have considered it if the agent had have replied "Over $1m" to your question?

As you've pointed out, Wylie, the whole process becomes very frustrating and really doesn't benefit any of the parties involved- vendor, agent or buyer.

Absolutely how it was for us. Frustrating. Perhaps shuggy had not given any indication of what he was prepared to accept, but the agent "could" have told us that interest "around the $1M mark" or "interest at over $1M" would have been helpful for us. Instead, I didn't bother taking it any further.

Shuggy, best of luck with your impending sale. Now that you've been through the process, is there anything you'd do differently at all?

When I typed that initially, I meant that it was good that he didn't spill any information about "grabbing a bargain" or letting on that the vendor is desperate or "you can get it for $800K". So from that point of view it was good for the vendor that he wasn't passing on information to encourage us to make a low offer.

However, when I made it quite clear that we have not looked at even one block of units and had no idea what this would be worth, I agree that at this point, we did lose interest. The only reason we went to the address was that we were heading to the coast anyway, but no way would we have made the trip with no price guide.

In fact, after he told me twice it would be good to get my feed back, and I told him twice that we were clueless, I was peeved at his attitude. I thought he could at least tell me it was under or over $1M, but no joy there either.

So I probably didn't make my comment as clear as I could have. I agree with what you say. I had lost interest with no ballpark figure being given. The only reason I even knew it was passed in was by reading shuggy's comment and link and thought "aha!!".

I think an agent who will give NO indication of price is as bad as an agent who gives too much information about a vendor which can be used against them by a purchaser who knows how keen they are to sell, or similar.

And I will also say "good luck shuggy". It is a nice property and I hope it sells for a good price for you.

 

[VYBerlinaV8]

Couldn't agree more. If an agent wants to play coy/games with me, I'll quickly lose interest. I don't care whether he's trying to assess the bidders, just tell me how much and if I'm interested at that price I'll turn up. It's like an agent who tried to convince me in-room auctions were a good idea. I asked her target market, she said it was people like me (mid 20's, wanting to renovate), and I told her neither me nor three of my friends who were looking at the time bother to attend. If it sells, too bad, and if it doesn't I can make an offer afterwards, but turning up is often a waste of time.

Agreement from me too. I've walked away from properties I would be happy to buy because the agent wouldn't give me a straight answer to the question "how much"?