Go on, ask us anything

    newsroom

    The Hidden Value of Online Auctions

    July 14, 2021

    These days, everyone wants to buy right now. Life is online. People buy cosmetics and make appointments for the doctor on the sofa. And now, Australians want to buy a house from the comfort of their couch too.

    Thousands of people have purchased a property online. The AuctionNow platform has completed over 11,500 auctions and consumers love this method!

    Curbside auctions will always have a place, but the pandemic has accelerated demand for online. A person residing in a loft in New York or London can now purchase property in the safest place on the planet, Australia.

    Lee Woodward recently discussed the concept and their experience with online auctions with two of Australia’s very best auctioneers — Peter Matthews and Ben Mitchell. Pete has done 26,000 auctions and counting, and Ben has done 11,000 to 12,000 auctions and counting, with a thousand auctions this year.

    Pete says, “If agents aren’t prepared, then they will be replaced, not by the technology, but they will be replaced by the agents that have transitioned into that digital space, and become a genuine digital agent.”

    “From a traditional auctioneering perspective, it took a little bit of getting used to. Fortunately, with AuctionNow, we’ve actually been doing online auctions for a number of years. With COVID, we could take the live auction environment, put it directly into an online world, satisfy all parties, and actually provide a better experience. We can communicate and conduct an auction more broadly, so that buyers, sellers, and agents connect more remotely, but still follow a very strong compliant process that’s transparent for all parties.”

    To make an online auction have the same kind of magic as a public one, the auctioneer has to draw in the audience slightly differently.

    Ben says, “You lose that street theatre and the joy of having a laugh.”

    “However, you replace the street theatre with being a conductor in a room. I’ve got the computer next to me, and the bids come through. I juggle between the buyer online and the buyer in the room. And it’s really quite good.”

    It’s good because you basically have an audience of people who want to be there, eager to make the sale. Online auctions have also made a significant difference to the real estate industry as a whole.

    Industry compliant

    Ben says, “Gone are all those days of having to sit out the front and pencil a bid. The platform was built, first and foremost, around compliance. You can’t miss a step. At first, it might sound daunting or feel daunting, because you’re doing it all on an iPad. However, it doesn’t allow you to miss a step through the process.”

    The process is transparent, complete, and accurate

    The process is compliant and easily auditable.

    Pete says, “From an agent’s perspective, you also get to understand exactly what properties you’ve got coming up, what your performance was like. You’ve got a complete digital record of that sale, a record of bids, and the actual bidding record of where it started and where it finished. Streaming the auction also means that it is a recorded event. So, if there was ever any issue or anything that needed to be reviewed, you just go to the bunker, go back to the videotape, check out exactly what happened, which adds to the transparency of the process.”

    Further, for consumers, they can see what they need to see, recorded in real-time.

    Pete says, “I think transparency in the process is probably one of the most critical things. Consumers feel that they’re in the right place, and that they’re getting access to the right services. On the buyer’s side, if you register on auctionnow.com.au, and you then decide to go and register to bid a property, all your details already in there. So it is one place where you can store all your information. You can update it. You get to see what you’ve had a bid on, what properties that you are following, and the like.”

    Take out the stress, but add urgency

    For buyers, auctions are sometimes anxious and stressful time.

    Pete says, “Online auctions give buyers some comfort. And I don’t think it takes away any of the urgency in the process. In fact, I think it actually probably adds further urgency because those buyers are looking at the auctioneer, they’re listening to the countdown, they’ve got a keypad in front of them, and they can decide whether they type in the bid or not. And they’ve always got the agent on the phone, talking to them if they need to. It solidifies the whole process, and it brings it all into one single environment, where all the information that every party needs to be confident about the process, is all held in AuctionNow.”

    Attract a new segment of buyers

    AuctionNow also opens up markets. You could physically be in London, but you can be bidding on a property in Sydney. Also, buyers who don’t want to bid publicly can now participate in auctions.

    Ben says, “For those buyers who couldn’t physically make it to the auction, there is now a platform for them to actually participate in the auction, whereas in the past, they probably said, “Ah, look. No – we’ll give it a miss.” When people stay at home and do the auction, I find that they’re quite relaxed and we’ve got some phenomenal results.”

    Encourage great results

    There is a large section of people who like bidding away from a crowd, so online works for them.

    Ben says, “I’ve seen some results under this platform that you would, honestly, could not have got in the street theatre. There could be a couple of reasons for this. We have more buyers than you normally would, because they couldn’t attend the auction. Or buyers are sitting there in the comfort of home or work, and they’re not rushed. Auctions are quite fast-paced, and a lot of people can’t make decisions like that. Now, these are slightly slower, because of the fact that we’ve got to make sure that we’re ticking all the boxes, so it may make participating easier. We’re finding a husband or wife, saying, “We really do want it. Why don’t we go another five? Let’s go another 10.” And I’ve seen some huge results, just based on the fact that it seems to be a lot more relaxed environment for the buyers.”

    Pivoting is easy

    Ben says, “When you’re digital, everything is as a touch of a button. So you can change dates, move dates, change process, change the way that you actually communicate with the buyer and the seller along the way. Whereas, if you go down the analog system, it’s so hard to move the ship. We’re trusted advisors. We’re supposed to be giving our vendors and buyers the best bit of advice on the day, at the time, based on the information in front of us. So the ability to have that information and move the sale in whichever direction you think is best for the vendor or the buyer’s situation is a huge key for us.”

    Pete says, “We’ve got auctions that went up for auction on Tuesday night, we’ve got auctions that are going up on Thursday afternoon. We’ve got auctions going up on Friday evening. These are residential properties, that traditionally, you wouldn’t expect to sell at these times. The reason why you wouldn’t is that you’d say, “Oh, we’re not going to get people to be able to come to those at that time.” The convenience and the flexibility of running a digital process just means that you have got complete control over when it is time to sell. There are moments in every campaign, where it builds to a certain point, where you say, “Okay, now I think is the time” and AuctionNow lets us take advantage.”

    How does it work with Private Treaty? 

    BuyNow was created as a facility for properties to be sold before auction, if there was heavy competition before the auction date.

    Pete says, “BuyNow is effectively an opportunity for sellers and agents to have a different form of sale, which allows the same platform to be utilised, and the same processes. Rather than bringing the auction forward, it actually is a timed auction where the date is set, the time is set, and all buyers are advised. They still register for the process. But then what they do is that the auction starts, and then buyers then have the ability to bid, and they can place their bids just like they would at a normal auction.”

    Pete continues, “Once a bid comes in, allows a little bit of time, that’s generally around five minutes. And that allows then for another bid to come in. So sometimes it can be a slow process but sometimes it’s actually a very, very swift process, because buyers like to get in before the time goes down. But as it trips down from five minutes down to your last 60 seconds, buyers make those bids, and they are bids that are offered, effectively. If an auctioneer oversees it – it is an unconditional sale. So it was all done originally for the presale for auction. But it’s now actually been widely used as a tool for private treaty properties, because it doesn’t necessarily have to be an unconditional sale. But that’s really subject to the agent.”

    Is it hard to learn and use?

    An auditable path creates transparency and confidence in the process. We are in the transaction space. The process for a sale is the most important thing. A platform like AuctionNow makes it so simple. All the hard work has been done and fine-tuned and there are people on hand to guide, train, and coach.

    Pete says, “In the past, everything was paper. You had double sets of documents that had to be identical. And still, today, some agents are exchanging contracts on paper. There’s a lot of running around. There’s a lot of potential error that can take place. There also wasn’t a lot of guidance and training and coaching like there is today, around a process.”

    Pete likes AuctionNow because he sees it as a natural extension of what agents can do, and also what buyers and sellers expect. He says, “Digitally, we can impose deadlines and have a transparent process for the buyers to participate in. We can create a live auction event, and have that as a physical event, as well as a digital transaction, with a buyer that could be anywhere in the world, any time. It can be all done live, and the contract can be completed.”

    “It’s a really, really tough gig being a buyer out in the marketplace. And having a transparent process that you know is auditable, there’s a digital record that sits behind the scenes that’s accessible which makes the process less daunting. And I think if you’re a seller, the uncertainty of knowing if there is a buyer to be able to do a deal with, this process provides certainty to the seller.”

    Online gives a level of convenience and flexibility that offers a great deal of value to the agent, and certainly, it adds a great deal of value to the seller.


    Are you taking advantage? Contact us to find out more.