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Selling at auction – Your guide to preparing for auction day

When selling your property, there are quite a few different modes of sale you can opt for. When it comes to the choice of selling your home through the auction process, the choice will be largely dependent on your country, and the type of property you have.

Higher end and luxury properties are often sold through auction due to the nature of Australian and New Zealand auctions focusing on the quality of the property, with price being the secondary concern. In this environment, keen bidders can drive the price of the property above market expectations in some cases, with no pressure to sell if the property fetches a lower than expected bid.

Another benefit to selling at auction, is that you will attract genuinely interested buyers. In Australia and New Zealand, those bidding at auction must do their due diligence before bidding. This means the contract of sale is not subject to inspections or finance – as these must be organised before auction day and ensures only serious buyers will show up to bid.

Once you’ve decided on auction for your property, how can you ensure you’re best prepared for the day? To help you, we’ve gathered a list of considerations and frequently asked questions from Harcourts top auctioneers.

Before the auction

Auctioning your property is about so much more than simply showing up on auction day. There’s a lot that goes into it before-hand to ensure you achieve the best result possible for your property. Marketing your property well is chief among the things you’ll need to do.

Your agent should walk you through your marketing plan in detail, from the images that’ll be selected and advertised, the copy that will be included, to where the property will be advertised (online, papers, brochures, in office).

Before you go to auction, you should expect to hear from your agent on a daily basis and a face-to-face meeting around once a week. Ideally, you’d receive a written report which summarises all of these activities as well as the interest in your property.

Your agent should also be keeping you well-informed of the market, so that you can make the best decision come auction day.

What is your role on the day?

If you’re in the country, the best recommendation is to attend your auction. It’s great to have you there if there are any last minute questions. Some common ones buyers ask are:

“Can we vary the deposit amount?” or “Can we vary the settlement date?”

Your auctioneer will also want to confer with you depending on how the auction is going. If bidding stops below your reserve price for example, your auctioneer will want to discuss next steps with you.

Getting to know your property

The auctioneer should be introduced to your property, much as your agent has been. They should walk through the property, understand the features of the home, and really understand why a buyer would fall in love with it. That way they’ll be able to better represent your home to buyers.

Your auctioneer will also want to know all about the interest the property has received. They’ll ask your real estate agent detailed questions about it. How many inspections have there been? What kind of interest has the home received? Have any valuations been done? Any building/pest inspections?

Marketing

When it comes to marketing your property before auction, the rule seems to be more is more. The success of your auction can be largely dependent on your marketing campaign. The latest research from Harcourts Group Australia, showed a direct correlation between the amount spent on marketing versus how much interest was generated for a property, and what price it sold for. On average, properties that sold in the shortest timeframe invested a further AUD$1,913 in marketing than those that did not see a sale in the 45 day period.

The reserve price

It’s important for you to understand and be clear on what your reserve price is, and how it’s used during the auction. Your auctioneer should be able to explain this to you in detail. You will need to discuss your reserve price with your auctioneer.  They should be working to ensure you get the best price possible for your property.

That being said, try to avoid openly discussing price with others, to reduce the risk of price leaking out into the market. The auction should focus on the product (your home), and price should become secondary.

Harcourts Auctioneer, Chris Kennedy believes there are three types of figures to consider before the day:

  • Your happy price – The figure you’d be very happy to accept.
  • Your ok price – The figure you’d be ok with based on the feedback you’ve received, you don’t see a win but you don’t see a loss.
  • Your grumpy price – This last figure is basically the one you wouldn’t be thrilled with, but given market conditions, you’re prepared to unhappily sell at that price.

Remember, at all times during an auction, you’re in control. If a bid is high enough take it. If not, don’t. But the reason for not taking the offer needs to be greater than the reason the home is on the market in the first place.

Chris discusses the auction process in New Zealand in the following clip.

 

Frequently Asked Questions

  • What if no one registers for/turns up to the auction?
    Harcourts Auctioneer, Andrew North says, in reality, this isn’t something that happens very often. Both you and your agent will know well before auction day how much attention your property has received and how much interest there is, giving you a good indication of how many bidders are likely to show on the day.
  • What if nobody bids?
    It’s understandable that buyers might be nervous during the excitement and pressure of an auction. This is why it’s not uncommon for an auctioneer to be met with silence when asking for an opening bid. Most people are waiting to see what others at the auction might bid.  In the event that no one calls out an opening bid, the auctioneer will nominate a starting bid to get the ball rolling.
  • What if the reserve price is not reached?
    In this event, your auctioneer can pause the auction and come and speak to you, the seller. They will go back to the current highest bidder, and ask if they’re prepared to increase their offer to a price at which you’re prepared to sell. If the bidder is not prepared to do that, your auctioneer will then see if you’re prepared to lower your reserve price. That’s why it’s important for you to have a price in mind that whilst you wouldn’t be entirely happy with, you are prepared to sell at. If neither of these scenarios happen, then a sale cannot occur, and your home will be what is called ‘passed in’.
  • What happens when the property sells?
    After the sale, it’s time to focus on the buyer. Your auctioneer should take them aside to start looking at the paperwork and get the contract signed straight-away. It’s also time to look at how the deposit is going to be paid. As the current owner, you’ll then sign the paperwork, and the sale has concluded.

 

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Landmark Harcourts and Harcourts Partner to Showcase Properties to China

With a notable increase in Australian property enquiry emanating from the Harcourts network in Hong Kong and China; Landmark Harcourts has partnered with Harcourts to showcase Australian properties to China through its Connect with Australia property showcase. Responding to the particular interests of Chinese investors, Landmark Harcourts and Harcourts together will feature large scale agricultural properties targeting dairy, protein and viticulture sectors as well as residential and commercial developments, off the plan homes, new apartment blocks, house and land packages.

July 9.jpgNow in its second year, the showcase introduced 80 Australian properties to investors in China in 2013, with a value of more than $185 million, with sales post the event exceeding $35 million.

The 10-day initiative showcase commencing on the 18th of September features numerous events in Beijing and Shanghai, each designed to promote Australia to the largest market in the world.

The showcase launches with the Beijing International Property and Investment Expo where the Landmark Harcourts and Harcourts teams will have a professional and prominent stand with targeted marketing collateral and a significant range of Australian opportunities for investors to consider. In addition, new technologies such as the QR code video marketing of properties in English and Chinese, will be deployed to reach into the huge Chinese market. This event will be host to 240-280 international exhibitors, with 40-48,000 visitors attending, including 8,000 invitation only, high net worth visitors.

The showcase provides a platform for Landmark Harcourts and Harcourts to build relationships with key people in China, Australia, and other Countries, and to create positive brand publicity across multiple mediums.
Landmark Harcourts General Manager, Craig Yarrow, said previous experience in China has revealed that value-add services are important to investors. “We’ll be offering a full value chain with specialist partners in accounting, law, finance, migration and more. In partnership with Sino-Australia, we’ll be able to provide Chinese investors a streamlined and proven process, responding to their queries and making it much easier for them to make choices and invest,” Mr Yarrow said.

“Our partners, Harcourts, will be alongside us promoting their specialty Australian properties in the residential, development and commercial sectors. Harcourts, with 126 years of experience in the real estate industry, has an extensive network of branches in China and Hong Kong, and we’ll be working together to show Chinese investors the value and opportunities that exist in the broader Australian market,” Mr Yarrow continued.

A presentation by Landmark Harcourts at the Beijing Property and Investment Expo will occur on the 21st and will educate attendees on the prosperous investment opportunities in Australia. The presentation will provide links for Australian producers and Chinese investors in joint venture partnerships or ownership of large scale ongoing operations ripe for farm expansion and development.July 16.jpg

The entire showcase will also feature two exclusive investor evenings hosted by Landmark Harcourts and Harcourts on the 23rd and 27th of September supported by AustCham, the China-Australia Chamber of Commerce, and Oz-Town Shanghai, a new centre committed to growing the Australian export market in China.

The investor evenings are invite-only, with a select number of targeted, high net worth individuals seeking to learn more about Australian agribusiness, development investment and associated joint venture partnership opportunities expected to attend. Five speaking sessions will be held throughout each evening, with each session providing an opportunity to educate the audience on points of interest including; government investment policy, agricultural assets, finance, the future for metropolitan investment and successful joint venture partnerships.

It is expected that extensive media coverage and on-the-ground promotion will attract business representatives, companies, investors, government officials and influencers to the showcase. A number of sponsors including AgScope and The Australian Financial Review have come on board, recognising the positive media exposure and buzz the event will generate, with marketing collateral expected to reach over 1.5million people in China.

China has a long history with Australia, and over time, this has reinforced strong relationships. Nearly a million Chinese and Hong Kong visitors came to Australia in 2013, in addition to 7,000 business innovation and investment visas. With Australia being the number one country of choice for foreign investment, they are certainly an audience worth marketing to.

The “Connect with Australia” initiative provides a unique and innovative marketing opportunity to reach a different audience and maximize sales potential, after all, a potential buyer could come from anywhere in the world.


Australia’s Market Trends – June 2014

  • Cairns recorded the strongest results in Queensland with the median house price increasing by 5.6 per cent over the last quarter.
  • Prices in the Gold Coast rose by 4.2 per cent over the last quarter, the fourth consecutive monthly increase.
  • Growth in Sydney has continued, with house price growth of 8.15 per cent in the last quarter.
  • The New South Wales suburb of Beaumont Hills recorded the country’s strongest quarterly growth at 13.13 per cent.
  • The number of residential vacancies nationally jumped 0.3 percentage points to 2.3 per cent, representing 66,120 vacancies.
  • Dwelling commencements in Western Australia have surged by 38 per cent over the past 12 months to reach 25,600.
  • The median house price in Melbourne is $604,110 while the median unit price is $419,702.
  • The Australian Capital Territory posted a 17.8 per cent improvement in affordability levels, while Melbourne became 16.9 per cent more affordable and Adelaide became 10.9 per cent more affordable.
  • The Real Estate Institute of Tasmania’s quarterly report showed a median house price of $305,000 across the state.

Harcourts Luxury Property Selection to join LPS Shanghai 2013 Property Show

Harcourts Luxury Property Selection is glad to announce its participation to the 6th consecutive edition of LPS Property Show (www.lps-china.com) to be held on December 6th-8th, 2013, in Shanghai.

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Held in cooperation with Qatar Airways, M1NT Private Club, Beneteau Yachts and Interior Design, LPS Shanghai 2013 is supported by over 100 media partners and show sponsors, and will welcome 80 exhibitors from over 25 countries.

This impressive gathering of the world’s most prestigious properties from over 25 countries will be held from December 6-8 at the 5-star JC Mandarin, located in the heart of Shanghai’s iconic luxury shopping street, Nanjing West Road.

From beachfront villas, private islands, historical chateaux, mansions, and vineyards, to marina estates and golf properties, LPS Shanghai will once again provide attendees an all-access pass to enjoy all the facets of luxury homes lifestyles.

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Please view our Chinese Luxury Property Selection ebook here

Or our English Luxury Property Selection Magazine ebook here

Or visit us at the expo at booth C31 to learn more about our properties!

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Harcourts to Represent Australian Property at International Luxury Property Showcase

upglxsd8bdgj6o72bctjReal Estate Agent and Director of Harcourts Applecross in Western Australia, Eric Hartanto, has been selected to showcase exclusive Australian Property at the Luxury Property Showcase in Shanghai next month.

“This is a wonderful opportunity to promote the amazing properties we have to offer our international investors,” Eric said.

Eric and his team will be showcasing a selection of property from Harcourts’ Luxury Property Selection brand which includes exclusive property from Western Australia, but also Australia wide, New Zealand, the United States of America and South Africa.

Eric said the showcase allows him to build strong business relationships with high end Chinese property investors.

Investors often seek to relocate to Australia due to the high level of education standards, workplace opportunities and relaxed lifestyle.

“These exclusive events provide us with the ideal opportunity to discover what the overseas market is looking for and it enables us to provide that for them,” said Eric.
There will be 36 properties featured from Harcourts Luxury Property selection brand, with a total worth of over $175million combined.
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“The properties on offer range from $1 million to over $25million. We have a wonderful mix of property, including large scale developments, luxury mansions, penthouse apartments, coastal property and a range of lifestyle opportunities from golf to equine properties,” Eric said.

Sponsored by Lamborghini, Baccarat and Dassault-Falcon, the international real estate expo will provide a unique opportunity for Shanghai’s elite home buyers to interact with international leading luxury real estate experts in a prestigious setting.

LPS Shanghai 2013 will be held at the iconic JC Mandarin Shanghai, right in the heart of prestigious Nanjing West Road.
“This central high-end location, combined with the participation of world-famous luxury brands, will create a unique and captivating atmosphere, the perfect environment to stage luxury properties,” said Eric.

The Luxury Property Showcase in Shanghai is an invitation only expo, welcoming highly targeted luxury real estate buyers, investors, VIPs and wealthy individuals. Over 5,000 targeted visitors are anticipated to visit this year’s expo.

Eric has been with Harcourts for over 10 years and owns three offices; Harcourts Applecross in Western Australia, Harcourts Pratama Surabaya in Indonesia and Harcourts Pratama Nusa Dua in Bali. Eric has sold over a $210million worth of property and is consistently one of the top three sales consultants for Harcourts in Western Australia, and features in the top 20 list for sales consultants with Harcourts Australia.632855-40e0f75a-51b5-11e3-9770-07dcc52d4773