BLOG: ‘There’s a shed-load of interest in auctions!’

With 24 hours to go, Appledore Barn, a steel framed agricultural building in Devon, has one bid of £36,000. Below the reserve, but a bid, nonetheless. There are 29 people on the watchlist, and the agent can see from their dashboard that most of them have completed the ID checks and input their payment details, so they are serious buyers ready to bid.

With 12 hours to go a second bid is placed. The increments are set to £1,000 by the agent, and the first bidder receives an outbid notification, so the agent is feeling positive about the auction interest and potential result. We might get to £45,000, which would be above the reserve and a good result for the seller.

At six hours to go the bids are gaining momentum and being placed with more urgency…”

At six hours to go the bids are gaining momentum and being placed with more urgency. One new bidder decides to place a confidential proxy bid, so that the system bids on their behalf up to their highest amount in the increments set by the agent.

Final hurdle

As we enter the final hour, auction interest increases and the bids are quickly coming in thick and fast now. There are now five unique bidders all fighting it out for the property. The agent’s expectations are already surpassed and Bamboo’s customer success team is taking calls from bidders asking technical questions. We reassure bidders that when bids are placed in the final five minutes, the timer resets to add another five minutes. A bidder tries their luck and waits until the last five seconds to bid…the timer resets back to five minutes. This gives everyone gets a fair chance to bid.

Appledore Barn was sold for £90,500, 126% over the guide price.”

After 47 unique bids and 20 minutes of extra time, Carter Jonas Online Auctions, powered by Bamboo Auctions, sell Appledore Barn for £90,500, 126% over the guide price. The winning buyer is instantly charged and the property has been exchanged online, with a legally binding commitment to complete.

Appledore Barn is one of over 5,000 transactions sold through Bamboo’s platform and we’re seeing more and more reputable and forward-thinking agents using auctions as an alternative route to sale and embracing our technology to manage the transaction.

Speed of transaction

It’s no secret that the market has seen ever increasing transaction times. This does nothing but frustrate sellers and buyers who are desperate to move, and agents who want the transaction to go through so they can take their fee. Auctions, and in particular online auctions, provide an answer to this issue.

The method of sale is tried and tested, with decades worth of sales. Indeed, walk through any market town across the country and you might see, engraved in stone, the words ‘Estate Agents, Auctioneers and Valuers’. Most of these agents dropped auctions in the past, but they are now embracing it again in digital form thanks to the speed of transaction, the certainty of sale, the control and ownership of the service and process.

The method of sale is tried and tested, with decades worth of sales.”

Our stats reinforce this. Over the last 12 months, we have seen a 50% increase in the number of properties being listed for online auction by agents. As properties tend to be relisted if they don’t sell online first time, we are tracking price differentials between first listing price and the price reduction required to sell.

In April, we recorded that the average price reduction required to sell was close to 20%. In May, this fell to 11%. As we closed July, the average price reduction was around 9.5% of the original reserve price to sell (if a property does not sell first time). June was an anomalous month, given the election period.

Opportunities for agents

For the agents who have not yet introduced auction to their stable of services, now is the perfect time to do so. Over the last six months, supply has been steadily increasing and we have experienced a softening in the market. Buyers have been putting strong offers in and the market has been fragile.

Buyers have been putting strong offers in and the market has been fragile.”

The stats are vital for our agents and are telling us two things; firstly, that pricing is hardening and aligning with buyer expectations and secondly, that our agent customers are continuing to provide a high level of service and advice when it comes to pricing.

In the wake of a Labour landslide and with greater economic certainty, we are now seeing a rebalancing of the market. Green shoots are appearing and now is the perfect time to introduce auctions to motivated sellers.

Robin Rathore is Founder and CEO of Bamboo Auctions.