One-buyer auctions: oxymoron or not?
Down in Melbourne, AFL games at the MCG attract a multitude of ticket re-sellers to one walkway along the Yarra River. Their tickets fetch $1,000 from time to time.
Ridiculous? Sure, to some. If you’re a first-time attendee, probably. New punters meander in hope of finding a cheaper ticket. Sometimes they do. Often they don’t. It’s a gamble. Superfans and sidewalk veterans grab those deals, knowing the value of having found a ticket at all.
At $1,000 it’s worth it to them, at that time, in that place.
A straightforward transaction, it’s one that sees buyers and sellers perplexed whenever it applies to property. Home prices are always subjective as we battle to prioritise our emotional connection to a property vs. the price we’re willing to pay.
Last year, people were banging down Sydney doors for a chance to buy, so the market price was loud and clear. Vendors said: “whatever Joe got next door, and then some”. As the market readjusts and the mentality is less ‘more more more’, the synchronicity will return to the market: 1 seller + 1 committed buyer leads to a successful sale.
Now there’s a thought Sydney has forgotten in the past 8 years: you only need 1 buyer… if you’re it, how much do you pay?
The thing about homes is, they’re worth what someone is willing to pay for them. In a heated auction, you’re making offers you think will beat other bidders. In a one-person transaction, you’re trying to be powerful enough to convince the vendor to sell to you.
It’s perplexing when buying. We need forget where the market sees value, and decide what it might be worth to us in that moment. Are we 100% set on that particular home, or emotionally neutral?
In this new market, this is where educated buyers and previous underbidders come into their own. With knowledge of what properties are worth, a been-there-done-that pragmatism will give them an edge over casual browsers.
During a recent spate of one-buyer auctions, these previously dissatisfied customers welcomed the chance to buy transparently, still on the auction room floor. This terrace at 2 George Street, Redfern went to auction with just one buyer. At $1.4 million, the expectations of the buyer and seller were close enough to see a successful sale on the day.
This Surry Hills apartment went from an off-market listing to being passed in at auction. It immediately sold post-auction to an experienced buyer who was watching behind the scenes.
If we’re aware of our status and have been given honest price feedback throughout the campaign, we make powerful decisions as lone buyers. We want to see value, opportunity and the uncertainty removed. Then, we’ll choose to bid strongly every time to avoid a ‘silent auction’.
For some however, a feeling of apprehension and suspicion still creeps in when the hordes of competitors retreat. Buyers wonder why they’re the only one who wants to buy the home. And vendors become anxious because they assume good results are associated with crowds and the theatre of auctions.
We’re so used to buying and selling our homes theatrically and hooked on the drama of transacting on the auction stage that we wonder, if there’s only one buyer, is this an objective price?
With today’s well-informed buyers and sellers, one-bidder auctions aren’t as oxymoronic as they sound. We shouldn’t be so hung up on the theatre. The property show is always playing out… one way or another.