Paul Wrigley of Ray White Toronto comments on the below article from Real Estate Business Online regarding auction clearance rates.
Paul says auction clearance rates are flat across most markets and sellers really should consider selling by private treaty. Auctions seldom sell in the Lake Macquarie market under the hammer and seldom get the highest price even once they sell after the auction. An auction typically sells for the seller’s lowest price and not the buyer’s highest price. One auction buyer reportedly said recently they would have paid an extra $25,000 for the property. When I asked them why they didn’t the buyer answered, well the agent didn’t ask me to!
In this case the agent worked for the buyer (and themselves) to get the property sold as quickly as possible and didn’t care about achieving the highest price possible for the seller. Paul Wrigley say’s if you want to sell your property for the highest price, talk to his sales team at Ray White Toronto about selling by private treaty.
With auction clearance rates flat across most markets, real estate professionals believe vendors should be looking to sell their property through private treaty. According to the latest Real Estate Business straw poll just over 64 per cent of the 322 respondents believe private treaty to be the most effective sales strategy in the current market.
However, Starr Partner’s chief executive Douglas Driscoll said agents should not completely reject auctions based on recent clearance figures. “I think it is important for anyone who studies auction clearance rates and attempts to compare them to last year’s activity, need to understand the market was artificially high,” Mr Driscoll said. “Twelve months ago agents weren’t selling properties, people were buying them, and now we are seeing a correction occur in the market place.”
“Despite popular opinion today’s market is still a very healthy, we are seeing strong buyer demand brought on by a lack of available stock, so the fundamentals for auction are certainly there.”
These comments were largely echoed by Australian property Monitor’s senior economist Andrew Wilson. Late last week Mr Wilson told Real Estate Business, in many instances, properties which don’t sell at auction in the current market, are selling soon after. “I think in most markets given the shortage of supply, we can expect to see auction results begin to pick up over the longer term with strong competition between buyers and the numbers of available stock.”