Online auctions: Property market to face test again as buyers and sellers come to grips with virtual bidding

Auctions across Australia will be put to the test again this weekend as thousands of properties remain scheduled to go under the hammer in the new world of online auctions.

Last week saw the property market turned on its head with agents, vendors and buyers scrambling to adapt to the new measures, which gave everyone three days’ notice to switch to online auctions and private inspections or virtual tours.

It came after the federal government announced that public auctions and open homes were banned from Wednesday, March 25 in a bid to limit the spread of the highly contagious COVID-19 virus.

According to Domain figures, there were scheduled to be 1248 auctions in Melbourne this Saturday – of that, 65 per cent are now up for private sale, 6 per cent will proceed via online auction, while a further 18 per cent are scheduled for auction but it’s unclear whether they will proceed.

In Sydney, there were originally 1224 auctions scheduled. Of those, 36 per cent are now listed for private sale, 21 per cent will proceed via online auction and a further 27 per cent are still scheduled for auction but it is unclear whether they will proceed.

Gavl auctioneer Andy Reid said many people were watching last weekend’s online auctions to gauge their success.

“I’ve had a few vendors and agents that wanted to see how it went and they were completely turned off by the idea of doing a remote auction,” Mr Reid said. “They weren’t prepared to accept the teething issues.”

But he said more vendors and agents had decided to push ahead than to withdraw properties.

Mr Reid expected Melbourne auctions to fare better than last weekend with one property in Malvern East already attracting five pre-registered buyers.

“An old Greek guy who I thought would be the last person to adopt this and an old Aussie lady who doesn’t own a computer [have registered to bid]. It’s just fascinating,” he said.

Another positive for online auctions is their flexibility – an auction can be held any time, any day – and agents are already reaping the rewards.

SOLD - $1,755,000

23 Magdala Road, North Ryde NSW 2113

3

2

2

View property

At Thursday lunchtime, a three-bedroom house at 23 Magdala Road, North Ryde sold under the hammer for $1.755 million thanks to competitive bidding from three active buyers just one week after it hit the market.

Viewers would be forgiven for thinking it was Saturday but selling agent Catherine Murphy said there was no reason not to hold it on any other day.

“Have you seen everyone on the internet saying what day of the week it is? It could be any day of the week. Everyone’s sitting at their desks at home in their pyjamas,” Ms Murphy said. “It got me thinking, why do I have to do it on Saturday?”

She said due to the nature of private one-on-one inspections, she had the cream of the crop of buyers within the first week.

“Showing 30 people through an open inspection in which you would get the lady next door, the man around the corner who is thinking of selling in four years’ time … you get a whole lot of people who will never buy,” Ms Murphy said.

“I felt like we were dealing with 100 per cent of the marketplace [one week in] … if you’ve got everyone already, then you might as well.”

“It was an experiment and it worked.”

She believed it was a marked improvement on last week and would continue to get better.

“It was like chalk and cheese … [last week] nobody knew what they were doing. Today was a dream,” she said, adding that all five buyers had registered the night before and everyone jumped online ahead of the auction on Thursday.

Contact Agent

84 Harding Street, Hendra QLD 4011

5

4

2

View property

Meanwhile in Queensland, a five-bedroom house at 84 Harding Street, Hendra has also secured two pre-registered buyers ahead of its scheduled auction on Saturday.

Place Estate Agents Ascot selling agent Patrick McKinnon said there was enough confidence to go ahead with the sell-off online.

“It’s amazing that both these buyers inspected the property before the lockdown happened … so we’re pretty lucky there.”

Mr McKinnon said he was familiar with the online process but it was forcing buyers to use it as well now.

Another online auction platform RealTime Agent reported an increase in the uptake of its service in the past week with about 250 scheduled auctions to go ahead this weekend.

RealTime Agent chief commercial officer Angus Ferguson said the industry has spent the last week catching up with the changes.

“In the past week and a half, we’ve seen another 80 offices sign up for BidTracker and digital auctions, which is proving to us there is definitely a market need and a real confidence around the auction transaction,” Mr Ferguson said. 

“More agents have been trained and are confident in using the platform. There’s been a lot of refinement in the past week.”