As an agent, you know that auctions have been the primary method of selling for the past few years.
Thanks to the property boom of the past decade, auctions have become an increasingly popular way to sell property in Australia.
The huge demand generated by a booming market has prompted agents and sellers to put properties up for auction to sell quickly and at extremely high prices.
Over the past few years, headlines have reported record prices as the hammer crashed down on Australia.
But things are starting to change. Auctions too?
As interest rates have risen in recent months, demand has started to fall and the market is showing signs of slowing down.
In May, the number of homes unsold in Sydney for six months or more rose 9.6%, while new listings fell 5.9% nationally.
As house prices are trending down across Australia, most agents are generally changing their auction strategy to private treaty sales, believing this to be a better strategy.
However, savvy agents will see this decline and understand that now, more than ever, properties need to be auctioned.
Education is the key
Because suppliers in a changing market need to be educated.
“The house down the street sold for $2.5 million last year. Mine should sell for more!
Who has heard this many times? This type of thinking can be quite difficult for agents, especially in a cooling market.
At times like this, the expectations of sellers opting for over-the-counter sales often don’t align with the current state of the market.
Having anticipated the same sky-high prices and fast selling speeds that were the norm when demand was high, it’s not uncommon for sellers to wake up abruptly when their property languishes on the market for months, and they’re forced to accept offers. below their expected asking price.
The blame game
So who are they accusing? their agent.
No owner wants to lower their price or sit back and watch the market go down, which is what makes bidding so powerful.
Auctions create urgency among buyers during a down market the same way they do during boom times. In addition, they are the best way to demonstrate to sellers the true value of their property.
Not only do auctions encourage sellers to exceed their (perhaps unrealistic) expectations, but they can also guarantee a sale much faster than waiting months for the right buyer to show up.
Even though we’re seeing a decrease in buyer demand, that doesn’t mean buyers aren’t there – they just need encouragement.
Auctions do just that.
Take action with an auction
Whether the market is strong or weak, auctions remain the best approach to realizing the true value of a property.
Likewise, however, entering an auction unprepared is a surefire way to miss out on a potentially lucrative sale.
So how do you prepare for an explosive auction even in this market?
Promo, promo, promo!
Maximizing buyer awareness is key to a successful auction and, as always, requires high impact marketing and strong promotion prior to the auction date.
However, the problem many agents have when it comes to promoting a sale is that sellers are unable or unwilling to cover the high upfront cost of seller paid advertising (VPA).
Where does that leave you as an agent?
If a seller is unwilling to cover the cost of the promotion, your only option is to go to auction without the necessary promotion – which will hurt the seller’s sale, as well as your commission.
Either way, it’s not a great result.
If only there was another way…
CampaignFlow makes it easy to market your auctions
Luckily, you can now overcome hesitant vendors with the help of CampaignFlow.
CampaignFlow is a financial product that frees sellers from the burden of funding their marketing expenses up front and allows agents to focus on the crucial work of promoting the property.
With CampaignFlow, sellers have three options for financing the cost of marketing their property:
- Pay in advance: Exactly how it sounds – the provider pays CampaignFlow and the marketing fees are paid directly to the agent before the campaign launches.
- Pay on success: Providing the ultimate peace of mind for sellers. A dynamic risk commission is paid in advance and marketing funds are transferred to the agent in advance. These funds are refunded by the seller upon settlement of a sale and are not refunded if the property does not sell – simple. This is an exclusive CampaignFlow option.
- Pay later: As a fully accredited and regulated lender, CampaignFlow offers competitive rates and flat fees for vendors who don’t want to pay their advertising costs up front. All fees and interest are paid at settlement, with a variable interest rate so sellers pay less if they make a quick sale. This way, the marketing funds are transferred to the agent up front, but the seller can repay the funds later.
Contact us to overcome supplier hesitation in a changing market
If your vendors don’t see the value of an auction or real estate marketing in today’s market, CampaignFlow can help.
Whichever payment option your provider chooses, CampaignFlow releases the funds to you in advance so you can start promoting a property quickly and get the result you deserve.
Visit our website today to find out how we can help you overcome supplier hesitation and ensure strong sales in a changing market.