With private treaty clearance rates dropping and their days on market rising, the auction method is more important than ever.
Not only are days on market lower with the auction method of sale versus private treaty but sellers on average achieve a higher price by selling under the hammer. The addition of a deadline to a sale creates urgency with buyers and is particularly important in a slower market.
Over the past year, Ray White sellers who went all the way to game day netted almost 11 per cent more on their auction sale price than if they had taken a prior offer. This potentially represents tens to hundreds of thousands of dollars sellers may be leaving on the table by opting for a private treaty sale or selling prior.
“More buyers are circulating the market and the energy is up, however buyer sentiment does remain cautious still,” Ray White New South Wales chief auctioneer Alex Pattaro said.
“Auctions are creating competition and energy across campaigns, particularly for agents who are converting from private treaty to auction.
“Auction day and private treaty clearance rates are continuing to move apart. Auction clearance rates are remaining consistent whereas the private treaty clearance rates are going down.”
This year, Adelaide still has the largest gap of any major market between the highest offer prior and sale price for auction at 12.62 per cent. In Sydney, the figure was 10.51 per cent and in Melbourne it was 10.42 per cent. In the sunshine state, sellers on average made 10.3 per cent more selling under the hammer versus selling prior and on the Gold Coast it was 10 per cent.
