When Auctions Seem So Hard… There’s Always Off-Markets!

This year’s auctions haven’t been easy. Not that last years’ were easy, but when it comes to houses, the only difference between spring season last year and this current market seems to be stock levels. Buyer competition is highly-fueled and as strong as last year, yet the numbers of quality properties available in the inner and middle ring suburbs are substantially lower.

So rather than stretch our top-end budgets beyond reasonable limits, we need to work hard on a different angle.

In any aggressive Seller’s Market, healthy agent-relationships are one of the most valuable commodities a buyer’s advocate can offer. There are always vendors in the market who, for one reason or another, have a reason for a quiet sale; a sale which isn’t recognised by the general public, doesn’t have a board, isn’t on the internet and is a sale with a reasonable price tag.

I’m often asked by buyers, “Cate, in this market, why would anybody not want to take a house to auction?”

And as hard as it is to believe that someone wouldn’t want to break records with strong competition fighting it out for the prized property, there are some solid reasons why vendors choose to have a quiet sale. Here are just some reasons;

The terms they require are quirky and may alienate buyers who are on an auction campaign, ie. a super-long term settlement period. I once had a negotiation with a 6 month settlement plus an optional six month extension clause at the vendor’s request. For many buyers that clause could have precluded them from purchasing if they weren’t patient and able to provision for an additional six months of occupancy elsewhere.

The sale is a sensitive one and the vendors don’t wish for the sale to be publicised. Divorce in a tight community is a common one.

The vendor doesn’t understand the benefits of investing in a good campaign with great photography, interior styling and printed material. Sometimes in these cases, their price expectation is not suitable either, but when they are setting a reasonable price but tightening the purse strings, the negotiation can be a good one.

The vendor has upgraded and purchased their next home, however they haven’t left themselves adequate time for a good auction campaign and aren’t in a position to advertise with a 4 week campaign. A good example of this is a vendor who has purchased with any settlement period of sixty days or less. By the time they arrange their home, interview agents, get photographs taken and hit the internet, they will have only a month or so to settle. Even with a short three-week auction campaign, they aren’t even in a position to entertain a thirty-day buyer, let alone a sixty-day buyer. I tell all purchasers who are reliant on a sale to make sure they have at least a 120 day settlement period on their purchase, and ideally 150.

This week I wasn’t successful at auction sadly; and we really did give it our best shot. But we had four purchases this week for four fantastic clients, and two of them were off-markets and two were purchased prior to auction.

A proud moment for us was when we negotiated for this stunningly renovated, period 3BR Edwardian single-fronted house in one of our favourite pockets of Ascot Vale. Our network of agents in the inner North-West had canvased quite a few options for us throughout our overseas expat’s assignment and this beauty made the grade.

Offering a completely renovated interior, ducted heating, a glorious rear open plan living area, beautiful gardens and a right of way, and sitting on a generous allotment of over 300sqm, we were ecstatic to secure the property for $910,000. They can anticipate quality tenants, a decent rental return (by period house standards) and capital growth outperformance over the coming years.

Ascot Vale has evolved over the decades and has a fantastic offering for singles, couples and families alike. With nearby Union Rd featuring bars,cafes and a bustling ‘high street style’ array of shops, transport links providing easy access into the city, tree lined streets flanked with both Victorian and Edwardian houses, bountiful numbers of private schools within easy commute, and the nearby Maribyrnong River cycling and lifestyle precincts just a short stroll away, Ascot Vale has it all.

Just 9km from CBD too… this off-market opportunity really was an obvious choice.