No Bids at Auction

[bazzer]

Today I attended two auctions in Adelaide (Glen Osmond), both of which resulted in the properties being passed with only a vendor bid(s). I also saw another property that was being offered for sale by negotiation after the same situation happended at an auction last week. It appears that the new rules recently introduced in SA requiring vendor bids to be disclosed is having an impact on the clearance rates here. I dont recall seeing this happen since the late 1990's. Interestingly at all three auctions the vendor bid was at a figure that was towards the upper end of what I would consider fair market value and about the figure that was quoted for the expected sale price. I would have expected that they would start the vendor bidding at a much lower figure and allow it to build up.

Has anyone noticed a similar trend over the last few weeks? I also read an article on Jenman's site about this(http://www.jenman.com.au/NewsNews1.php?id=142).

 

[willair]

Bazzer,
We attended several house auctions on brisbanes inner southside yesterday,all where passed in on vendors bids .
12 weeks ago those properties would have sold on the day
one thing with the last auction only 9 people turned up and only one bid was made..just another bump in the real estate road..
good luck
willair..

 

[brains]

Strong signs this property boom is coming to an end i'd say. Should be some bargains around when interest rates go up a couple of points.

 

[Michael Yardney]

Originally posted by brains
Strong signs this property boom is coming to an end i'd say. Should be some bargains around when interest rates go up a couple of points.

Brains
In Melbourne it's not as much that the boom has come to an end, but that potential purchasers don't want to start the bidding and without dummy bids to get the auction going, an auction becomes a quiet affair rather that the street theatre it was before.

We had an auction yesterday that sold becaUse there were 3 genuine purchasers and they all decided to bid. If it was the other way around and I was buying, I would not have bid and hoped that without dummy bids that the property was passsed in and I would be able to negotiate with a disappointed vendor

 

[brains]

I still think all the signs are pointing to the end of this property boom. Regardless of the new auction leglislation, if people are interested in a property they will be there to bid.

Agents in Sydney are blaming the recent low clearance rates on the new laws that bidders have to register and use a numbered paddle, thast crap and they are still trying to talk the market up.

The new laws dont change the number of how many serious bidders are at the auction. Also there is a record number of properties pulled from auction before hand from lack of interest. Ive been to a few lately with no bids, just a yard full of sticky beak neighbors (like me )

 

[damianr]

Hopefully the new rules will have an effect on the total number of auctions out there. The less auctions the better I say.

The real estate agents must hate this as they have to do some work to get a sale!

Damo

 

[nads]

Friend's of ours had their house up for auction in September with the vendor's bid of 250k....not a single bidder, all people present were neighbours, friends & family having a sticky beak.

The agent (Stockdale & Leggo) said that this was the third house that morning that had not sold. They put it down to negativity in the media, and talks of a possible rate rise.

This was in Melbourne.

Another house near us was also up for auction, highest bid was $180k, which apparently was well under the reserve price. Took 8 weeks for the property to sell after the auction. It sold at $180k. Agent was also Stockdale & Leggo (not having a go at them or anything!).

From my point of view, properties not selling on auction is an ideal opportunity to negotiate a great deal privately.

 

[WillG]

Hi Brains,

Interesting you say the market is coming to an end.

May I suggest it is fed up buyers that aren't prepared to pay over inflated prices often the work of over enthusiastic real estate agents.

I attended an auction in ACT a month ago where no bidding occured. The property was in a bad state of repair and expected price was too high. The owners changed agents and the property still hasn't sold.

 

[Peter_Tersteeg]

Correct me if I'm wrong, but the agent can still submit a vendors bit, but they must disclose that it a bid on behalf of the vendor.

I've seen plenty of auctions where the agent starts with a vendors bid. Sortly afterwards, another bid is made from the crowd and the auction proceeds from there.

Ultimatly, I don't think that these new laws will have any real effect if the market is running hot.

 

[brains]

Youre right on both counts PT. If the market was running hot the new legislation wouldnt make a bit of difference. The bottom line is if people want a house they will register for the auction and bid. If they are not intersted in it they wont. Laws or no laws.

Agents and other interested parties connected with property/finance/sales/seminars...etc...are trying to talk the market up as they have an ulterior motive, they have made a lot of money over the last few years and want it to continue but now its showing signs of ending.

I wouldnt like to be in the industry and looking at the next 5 or so years, it looks pretty bleak i'd say.


http://www.smh.com.au/articles/2003/10/19/1066502072621.html?from=top5

Originally posted by PT_Bear
Correct me if I'm wrong, but the agent can still submit a vendors bit, but they must disclose that it a bid on behalf of the vendor.

I've seen plenty of auctions where the agent starts with a vendors bid. Sortly afterwards, another bid is made from the crowd and the auction proceeds from there.

Ultimatly, I don't think that these new laws will have any real effect if the market is running hot.

 

[nads]

Brains,

I agree. The agent from Stockdale & Leggo that our friends dealt with, said he wanted to file a complaint because of the media's negative comments of late!! What a fool.

 

[brains]

HAHAHA!!!....what a bright bloke (or woman)

The media only write about the market not create it.

Originally posted by nads
Brains,

I agree. The agent from Stockdale & Leggo that our friends dealt with, said he wanted to file a complaint because of the media's negative comments of late!! What a fool.

 

[G&K]

Not an auction comment...but...I have noticed a few listed prices dropping in properties in Canberra (source: allhomes.com.au) One place that caught my attention because of its price was open for inspection when I was out walking the dog. I have no interest in it. The agent looked pretty bored and invited me in for a look. Well I keep a pretty keen eye on my neighborhood, but the vendors in this place really were stretching the agents ability to sell it. It wasn't even immaculately presented, something you'd expect for the asking price of 395K for a 3bdrm on a sml blk. I figure the vendor is punting on getting a high price before the rates go up. Or hoping some silly bunny will pay 395K. I told the agent IMHO this and he agreed and even went 10K lower than my estimate. The slide (or tide) just might be turning.
G.

 

[Aceyducey]

Originally posted by brains
I still think all the signs are pointing to the end of this property boom. Regardless of the new auction leglislation, if people are interested in a property they will be there to bid.

I'm with Brains here.

The auction legislation does not really make it more inconvenient for legitimate bidders so lower clearance rates have more to do with prices reaching higher than people can readily & comfortably afford.

I'm also seeing much slower clearance of property via listings than even six months ago.

At this point I'm willing to stick my neck out and say THE NATIONAL PROPERTY BOOM IS OVER. Regionally experiences will differ, but the days when you could buy virtually any property & make a decent CG in a short-period are over for now.

However what follows this boom remains to be seen

Cheers,

Aceyducey

 

[intoproperty]

Originally posted by Aceyducey
At this point I'm willing to stick my neck out and say THE NATIONAL PROPERTY BOOM IS OVER.

Agreed.

 

[ger]

I went to 4 auctions at the W/E
2 passed in
properties that a couple of months ago
would have been snapped up
I agree will Brains ETC
the legislation has nothing to do
with the slowdown