Navigating online auctions

Now that half of our country’s population are in lockdown, real estate, (like many other industries) have had to adapt historically standard practices in an effort continue trading. From digital contract execution to virtual inspections, many agents have embraced such methods for some years, but the truth is that COVID-19 lockdowns have shaken up how we facilitate the buying and selling process.

In our auction-centric, capital cities we have had to find an appropriate alternative to in-person auctions.

Aside from the fact that competitive buyer interest has marked a strong seller’s market in most cities, the truth is that Melbourne and Sydney are accustomed to auctions…. and people don’t particularly like change.

Melbourne’s extended hard lockdown of 2020, (which lasted for 112 days) demonstrated just now well our local agents could pivot their processes. Online auctions became the new norm and it’s fair to say that we’ve carried his methodology into our regular business processes now. Not only do we utilise online auction platforms when we’re in lockdown, but agencies have adopted it for other scenarios, including:

• Boardroom auctions
• Evening/mid-week auctions
• In-room auctions

Not all auction platforms facilitate an auction process under auction conditions, however, and it’s important to understand the difference. A publicly advertised auction may proceed earlier than the advertised date. In Victoria, auction sales that result more than three business days either side of the advertised date are NOT bound by auction conditions. They may still feel like an auction process, but the rules are slightly different. One key differential is the buyer may be entitled to a cooling off period.

Whether the online auction is bound by auction rules or not, there are numerous advantages to the process.

• Firstly, the buyers can bid from the comfort of their own lounge room
• If the portal is a virtual one, (as opposed to a platform with anonymous bidders whose identities are paddle numbers), buyers can switch on or off their microphones and/or cameras if they wish to talk privately or prefer to be unidentified
• Buyers can anticipate that the number of other attendees online are a better representation of likely competition. Unlike an in-person auction in the street where friends, neighbours and passers-by could be in attendance, it’s more likely that someone who goes to the effort of registering and logging in is closer to the sale process
• Travel time is not an issue. This is particularly relevant for anyone who has other auctions to attend, (especially a buyer’s advocate)
• Most agencies have a contract execution platform that is linked to the online auction platform. This means that contract population is efficient and for some, payment of deposit is interlinked with a pre-authorised credit card or online DEFT payment option

However, things don’t always go smoothly, and it’s important that bidders familiarise themselves with the platform long before the scheduled start. Over the past fifteen months we’ve seen a lot of nail-biting moments, including:

• Technical issues and internet drop-outs. Always make sure internet signal is available and consistent. Children on multiple devices in the home is a key issue to be mindful of
• Incomplete registrations on specific platforms. Some call for ID, credit cards and registration for paddle numbers. If you aren’t sure that your registration is formalised, make sure you reach out to the agent in the day(s) prior
• Bidders with background noise. Not only is it annoying for the others, but zoom audio will cut for every other participant, (including the auctioneer) if someone’s dog is barking or music is playing. Selecting a quiet location is important
• Muting by accident. So many people don’t recognise when they are either muted by the host or have muted themselves. If mute is in place and the participant’s camera is turned OFF, their bid won’t be received unless they can think quickly enough to use the chat box. Bidders should familiarise themselves with this backup feature if their portal allows. If in doubt, a camera ON will help pick up a raised hand or a gesture
• Being unable to bid despite being registered. We had a technical glitch last December when the numeric buttons on an online auction site weren’t working. A quick call to the selling agent mitigated disaster, and clearly it was a site issue, as multiple agents were fielding phone bids for the participants while we all watched the auction unfold live on our screens.

Agent communication, pre-auction practise and a backup plan are all essential ingredients for making it to the auction.

The remaining, and important ingredients involve auction tactics, a clear upper limit and confidence.

There are some clear parallels between in-person and online auctions, and remembering that you can still exert a presence is important.

And lastly; to use camera or not? We say, always.