With housing supply under stress and high demand from cashed up southern buyers, property agents are looking towards auctioning premium properties.
But local agents in the suburbs of Logan don’t see the Brisbane trend extending here any time soon.
They say most of the city properties in the city are high-priced homes which suit buyers who have either organised their finance, or who have the cash reserves to commit to a premium sale.
Most homes in outer suburbs however, are not in that price range.
Steve Mills from Elders Shailer Park said first home buyers were usually not in a position to withstand the conditions of auction – a commitment to buy, finance-ready, and unconditional.
“Auctions are generally used by banks to sell mortgagee in possession properties,” he said.
“If there are a few little issues with the house, that’s really the only time most will recommend a vendor goes to auction. That means there’s a general distrust for the process.”
Mr Mills said there was a low clearance rate for auctioned properties, at less than 40%.
Raine & Horne Shailer Park agent Ramona Ahmed sold a mortgagee in possession property at auction on January 30. It sold for $13,000 above reserve.
“Auctions work for repossession properties, but they generally don’t work well in this area,” she said.
“People need finance, and an auction can eliminate a portion of the market. It might mean that top-dollar buyers are missing from the process.
“So if people know they’ve got more time on their hands to sell, it’s better to take the property to the open market and seek expressions of interest.
“I recently had 40 people through an open home, so that’s a lot of people potentially keen on buying a single property. It’s a good sign, so why limit that opportunity with an auction.”
Laurell Veivers of Real Property Vibe at Beenleigh holds a slightly different view.
Ms Veivers says auctions can be a good way to gauge the market.
“I think everyone knows where they stand in an auction environment,” she said.
“The majority of people know how to do their research, so they have a really good idea of the price a property should go for. We usually give people a price guide which lets them know whether they’re in the game or not.”
Ms Veivers said auctions help set the price for a particular market, particularly if it’s volatile as it is now.
She did however, concede that we probably wouldn’t see the volume of auctions currently seen in the city – at least not yet.
“The city has an oversupply of units and an undersupply of houses which has encouraged agents to take their properties to auction,” she said.
“The good thing about that is that you know where you stand in five weeks. It’s a finite cycle.
“I’m a fan of auctions, and hopefully there will be a move to auctions in this area. In the long-term, I truly believe that auctions are a better process for the seller.”
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