1. We do not believe that auction is the solution to every sale but we
do believe that auctions reflect a realistic value for the property. When
there is a "bull market" the prices go far higher than what estate agents
believe the value to be but when there is "bear market" auctions reflect the
reality. If sellers want to live in hope and believe that prices don't
reflect the current market conditions we do not recommend them going to
auction. Our solution is not to place a property on our books and hold
thumbs that they will sell within the current average 4 month sales cycle.
2. Although Christian is being quoted completely out of context;
no-one can deny that the property market has tightened and auctions are
merely reflecting that reality. That is the power of auctions that they
don't lie, don't misguide, aren't hearsay or PR spin: they are the real
market. That is what attracts both buyers and sellers to them. Buyers and
sellers who live in hope don't use auctions because auctions are the truest
form of the market. There is nothing more pure than a willing buyer and a
willing seller getting into one environment and producing a real result
which is not suspensive on any deal breaking clauses.
3. Although auctions are non-suspensive on financing, they are on the
exact same conditions as any other sale. Buyers have a 4 week lead time to
arrange finance at an auction.
4. Every seller, including a liquidator and bank has the right not to
accept the highest or any price. The comment that this is not the case is
completely inaccurate and misleading. The only sale that is without reserve
is a sale in execution and these sales constitute a tiny fraction of the
auctions that are happening countrywide.
5. Lastly and most importantly when we promoted auctions as a first
choice method of sale, many agents throughout the country howled that
auctions worked only in distressed environments and would never work in a
strong, booming property market. Auctions are merely the real market working
where supply and demand meet. So auctions do work particularly well in both
strong and weaker markets. They simply reflect stringer and weaker pricing.
So it's amusingly ironic that Mike Bester is saying that auctions only work
in boom environments. That is the exact opposite of what estate agents were
saying in boom times. Auctions are completely multi-cyclical reflecting the
market in action in both good and bad times.