Auctions, what’s under the hammer.
While some people may initially be cautious of choosing to sell their home via auction, once you understand how the process works, and just how successful auctions tend to be, it is well worth considering.
To put this into perspective, if you look at all properties sold in our region this year to date, and look at the pricing methods used, (e.g. price by negotiation, fixed price and auction), auction properties tend to sell significantly quicker than other methods.
Year to date, Taupo and Turangi region have sold 347 residential and lifestyle houses, with the average days on market showing 102 days for other sales methods, and auction proving to be a quicker sale at only 61 days on market. Each vendor’s circumstances and goals are unique, but typically, everyone wants to achieve the best possible price for their property and to complete the process in a timely manner. Well, this is exactly what an auction can deliver. Each auction is unique, which means we have encountered a very wide variety of different situations, but this wealth of experience helps navigate the live situations in front of us to achieve the best result.
Our commitment to the process is how the success is built. From the beginning we are there to make the process easy and smooth. Auction day is the day we work toward, but there is a lot of work that needs to go on behind the scenes to make it a successful one. Auctions are a powerful and strategic method for selling properties, offering a structured yet flexible approach that can adapt to the unique needs and goals of each vendor.
At Bayleys Taupo, our team brings a wealth of knowledge and dedication to ensure that every auction day is a success. We understand that each property and vendor is different, which is why we are committed to making the process as smooth and straightforward as possible, making the experience exciting rather than intimidating. Buying and selling at auction is a thrilling experience, the nervous tension, palpable excitement and the inevitable outcome offers added benefits that other sale methods do not. Your Bayleys salesperson will ensure you have a firm understanding of the process and its benefits come game day.
We strive to make the ‘scary’ - exciting
and the ‘complicated’ - simple
“Trust the process, the sale will take care of itself”
At Bayleys Taupo, we have the experienced auctioneer Grant Bayley who has immense respect for the work that is done behind the scenes in the weeks leading up to the auction. We asked him what his take on auctions are, and if he has any advice:
“I am frequently asked to explain various sales methods in real estate and offer recommendations for selling our clients’ properties. To me, the most effective strategy for launching any property onto the market is through an auction. The initial launch generates the highest level of interest, so it’s crucial to maximize this interest during the early listing stages. Typically, there exists a pool of buyers actively searching the market who haven’t found what they’re looking for in current listings. When a new property appears online, these buyers often rush to view it. However, after this initial wave, only a few new buyers enter the market each week within the specific price range and property type, which can lead to properties becoming overexposed without attracting further inquiries. While alternative sales methods can also succeed, the challenge in a competitive market with lots of listings is distinguishing your property and securing a sale within a desirable timeframe.
The key advantage of an auction lies in committing to a robust marketing campaign from the outset rather than attempting to ramp up efforts later when sales may be slow. By then, it’s often too late to capitalize on initial interest.
Benefits of an Auction
The auction process creates a competitive environment like no other to reveal true market value, whilst ensuring transparency and an even playing field for all parties.
Competition:
A sale by auction is the perfect recipe for the premium price because it pairs serious sellers together in a competitive environment.
Transparency:
During the auction process all parties are aware of live bidding levels which ultimately helps to deliver fair market value.
Urgency:
By implementing a deadline, serious buyers are encouraged to take action for desirable properties.
Opportunity:
Before the auction takes place you may consider offers and set the reserve price.
Fair and equal:
When participating in an auction conducted by Bayleys, everyone is on a level playing field. In an auction arena, everyone is participating according to the same terms, understanding the sale and purchase agreement and its contents.
No limits:
By not setting a price during the marketing campaign you aren’t limited to an asking price that may be too high or too low.
Consider other methods such as “Price by Negotiation,” “Tender,” and setting a fixed price. Each approach carries its own risks. For instance, setting an asking price can limit interest if buyers don’t perceive value, while under-pricing may leave money on the table. “Tender” resembles an auction but tends to attract conditional offers contingent on factors like reports and finance, which can complicate the process and may even lead to an overall reduction in price at the end of the conditional period. Conversely, an auction with no pre-set price, bolstered by a comprehensive marketing push, represents a strategic choice.
By setting a specific auction date, you create urgency, compelling buyers to invest time, emotions, and resources in pursuing the property. Without a fixed price, buyers focus on the property’s merits rather than its cost relative to others.
“Throughout the intensive four to five-week auction campaign, the primary goal is to engage cash-ready, unconditional buyers”
This approach can divert attention away from exclusively listed properties and motivate buyers to hold off on competing offers until auction day, thereby potentially maximizing the sale price.
However, the process also identifies conditional buyers who can be revisited post-auction if necessary. This dual strategy—competing for immediate, committed buyers while preparing fallback options—represents an ideal scenario for maximizing results in any market condition.”
At Bayleys Taupo, we are here to support you every step of the way, turning the potentially daunting task of selling a property into a seamless and rewarding journey.
For further information, or to take your first step in selling your open, contact us below.