Like everything else in the world right now, traditional property auctions have been put on hold due to coronavirus restrictions
Since the government announced the ban, agencies have taken auctions, inspections and home tours online, with interesting results.
The last weekend in March marked the first weekend of this new digital realty reality, and by all reports, things got off to a shaky start. A decent percent of properties scheduled to go under the hammer were switched to private treaty sales or withdrawn completely after the new restrictions were implemented, as sellers feared the virtual unknown. But this past weekend proved their worries were wasted, with steady results recorded across Sydney—including an online auction for a three-bedroom house in Epping that drew upwards of 140 viewers, with 10 parties placing a combined 54 bids for the keys over an epic 45-minute bidding war.
First, if you’ve got your eye on a property, you’re currently still able to physically check it out by scheduling a private inspection with an agent who will follow appropriate social distancing measures. But if that’s not an option, agents are now offering virtual tours of properties prior to them going up for auction.
So, how does it all work? Well, to be honest, it’s not all that different from the traditional auction process—only now, getting dressed is optional. There are currently two ways an online auction can proceed. The first is simply a livestream of the event. In NSW, all potential buyers have to be approved first before registering to bid via the online auction platform, be it AuctionNow, Openn, or others. Once registered, buyers will receive a link to the livestream, as well as a reminder call from the agents five minutes before go-time. You can login remotely from whatever device is within reach from your couch, be it your laptop, phone, or iPad.
Through the website hosting the auction, the auctioneer can reach out to the bidder and accept or decline each bid. That way, there’s always a clear line of communication. The only real difference is that if the property fails to exceed or meet the reserve price, a handful of the top bidders will receive a phone call from an agent to talk through their position and begin negotiations, instead of having that not-so-subtle pep-talk on the street in public. The only real problem with this livestreaming option is the strength of Australia’s NBN, which currently seems to run at the same speed as a day in quarantine.
The second, albeit less favoured online auction option is called a ‘genuine time online auction’, which involves buyers sending off bids within a certain time limit, a la eBay. Here, minimum bid increments are set, and if a new bid is placed within the final five minutes, the auction is extended by another five minutes to allow other buyers to counter that bid. Once the highest bid is accepted, a digital exchange follows, with the only physical interaction being the delivery of your new keys.