“Auctions Don’t Work Here!”
WARNING: This article might be controversial to agents who are resistant to change their pre-conceived notions about auctions and the market they sell in… but please, hear me out.
As many readers of the REIQ Journal know, I’ve been working in real estate for a few decades now. When I reflect on my career, I’m grateful that it started under the watchful eye of George Hadgelias at Ray White Paddington. It was there that I learnt a lot about the importance of mindset, and how that can and will have a dramatic impact on a person’s success.
A new person to real estate is a precious and valuable asset for one simple reason: they don’t know what they don’t know. That’s a blessing! It’s only over time that they get experience and can make informed decisions about what real buyers look like, how a motivated seller talks, what works and what doesn’t work so well in the market they sell in.
When I started with Hadgelias, it was a given that selling by auction was the norm. I saw how well it can work for the seller, and the impact it had on the agent’s income and the business in general. Hadgelias could accurately predict the month’s results far in advance because of the relatively high success rate of sale by auction.
I attended Ray White training that was heavily focused on auction. You could even go so far as to say that I was fully immersed in the world of auctioneering and its benefits for all parties. Despite this, it still wasn’t easy to continually list auctions because there was resistance from the market, fuelled by negative input from agents who weren’t using it as a method of sale and opposition from sellers to the idea of paying for marketing. At this stage, the internet was about to hit, but newspaper was still king.
As time went on – and I moved on – I joined the corporate team and saw everything so differently. Some agencies and agents didn’t have what I call ‘an auction culture’. That is where I first started to hear the phrase “auctions don’t work here”. I tried to fight it by trying to convince salespeople that it was just another method of sale – like a multi-list, open listing, sole agency or tender. That there’s a process and if you follow it, you’re more likely to achieve a sale.
Through this experience, I came to the realisation that it’s not the auction that fails, nor is it the market, property or seller. It’s the agent, their mindset and their willingness to follow the due process of an auction.
With that in mind, here are four real estate truisms:
- Every seller wants top dollar.
- Every buyer wants a bargain.
- The only thing stopping a sale is the price.
- There’s no ideal auction property or market.
A team member I had in one of our offices on the Northside some years ago once said, “there is a buyer for every property, it just comes down to getting the price right”. And they’re right. At the end of the day, it will be the agent who determines if they will have an auction business – not the market.
So, if you’re a newcomer to real estate or a veteran like me, don’t be afraid to challenge the way you and your colleagues think about auctions – the results might just surprise you!
Kevin Turner hosts Australasia’s longest running and most listened to podcast for real estate agents, business owners and property managers – Real Estate UNCUT.