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4 Comments

  1. Paul Lucas
    April 20, 2021 @ 10:23 am

    Hi Neil

    One way to overcome the problem you described above is to use the Dutch Auction method as used in flower sales in The Netherlands.
    Using this method the auctioneer would start of with a high price and then successively lower the price until a buyer bids his/her highest price.
    Auctions would be a lot quicker and and the seller would know that he/she obtained the buyer’s highest price.

    Regards

    Paul

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  2. Rolf Nichols
    April 20, 2021 @ 12:24 pm

    Very true Neil. As an example take an Ebay auction. You put in your highest bid but if the current bid is well under it and you are the highest bidder at auction end you will buy it at that price-even if your initial bid is way higher. The same with wine auctions. I have bought many wines online way under what I thought was realistic -saving me hundreds over the years. With houses it is the same. But compare with what happens in Tasmania-no auctions at all! Just a price quoted as “offers from”. This way you can offer the property at the highest price sought in the beginning -and you may get even more. This is as you say, dutch option (auction) however it brings out many more buyers. Naturally the agent selling will have had to establish the highest and best possible price first. That is the hard thing since most agents are lazy and auctions are so much more expedient. Keep up the good work.

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  3. shireen phillips
    April 20, 2021 @ 1:34 pm

    Well worth reading!!!

    Reply

  4. Jason Smith
    April 20, 2021 @ 6:44 pm

    This would be hilarious if it wasn’t so serious. I took my family to an auction on the Sunshine Coast a couple of weeks ago. At the start, the auctioneer explained that when bidding reaches the reserve he will call it ‘on the market’ and then actually said ‘the reserve price is the lowest price the owners will sell for’. Wow! Bidding started slowly and crawled along at $5,000 increments until the auction was paused at $1.6M. The agents then scrambled to crowd around the vendors and I said to my wife, ‘watch this’. We could hear the conversation from where we were standing. Their reserve was $1.8M. They had paid $1.55M off the plan two years ago. The thumbscrews were being turned. Agents told the reluctant vendors to lower the reserve to $1.6 as this would motivate the bidders and lead to a bidding war. They said they were confident of reaching $1.8M but only if they lowered the reserve immediately. We could see the vendors’ reluctance. But they agreed. The auction was back on. The property was called ‘on the market’. Everybody waited for bidding to resume. But nothing. Not a cent. In less than a minute the hammer went down. Sold for $1.6M. High fives. Everybody applauded. Everyone except the vendors who hurried themselves into a different room. I have seen this time and time again. I would never sell my home at auction.

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