19 March 2003
I was expecting to jump on here tonight, jubilant at the wonderfully inflated price that Lot 2, 139 Guildford Road, MAYLANDS had fetched at auction.
I guess that's because I was expecting bidders to be as seduced by the auction environment (and the quality of the property, of course!) as I was by the amount of pre-auction interest. However, a large component of that interest was due to my Agent's advertising tactic that I'd consider offers above $50K prior to auction, even snagging a Saturday Real Estate page two editorial article as a result.
The lot was auctioned because:
· I wanted to maximise the sale price by testing the market at auction; and
· I needed a quick sale to clear subdivision costs.
In selling my Hamilton Hill unit to buy this property last year, I felt pressured by the agent into pricing the property too low. After much haggling, we finally set a price I was happy with and the unit sold within a week on the fourth offer. When told it had sold, a fifth party tried to submit an unconditional cash offer the next day, hoping to gazump the sale. In effect then, five offers in a week! I remain convinced that at auction, a better price would have been realised.
So when agents started talking about potential selling ranges of $80-100K (too low, I felt), I was whacked over the head with deja vu!
Then along came agent number three talking auction. After much thought, I chose to take that option and rationalised the $2K extra costs as venture capital. A small risk (in the scheme of things... I don't blow $2K every day!!!), against a potential increased return.
I failed to seriously consider that my reserve price might not be reached, so I went along to tonight's auction not wondering IF it would sell, but rather wondering HOW HIGH it would go! When bidding stalled more than 10% below reserve, I had to make a snap decision whether to sell or not.
In the end, it was my expectation of a sale that decided for me. It was a horrible feeling, thinking I was letting it go so much lower than I wanted to.
The certainty that it would sell, though, sparked another exchange of bidding. The hammer finally came down just $2K below reserve, at $88,000, right in the middle of the range proposed by those agents that I had thought were pricing it too low.
Would it have fetched a better price through a traditional sale on the open market? Should I have held out for more after auction? Had the agent's advertising tactic attracted a crowd that wasn't prepared to go higher? Or, in the end, did the selling price simply reflect what the property was worth, as evidenced by the opinions of several other agents and based on recent sales? I might as well ponder the meaning of life!
I achieved a quick sale to recoup subdivision costs and I tested the market, which spoke loudly and clearly in a very similar voice to the agents. Scary to consider that two different agents might be more clued in to the value of my property than I was!
I am now left with the most desirable of the lots to sell at my leisure, free of the financial pressures driving this sale.
And with 40,000 frequent flyer points into the bargain, how could I go wrong?
Bye for now... Rob.
In case you're wondering what the hell this all has to do with Highway One, the answer has to be, NOTAHELLUVALOT!!! I drove down it from Geraldton to get to the auction... good enough?