There was a good mix of apartments that could have appealed to both owner-occupiers and investors at this week's main Auckland apartment auctions, but only a quarter of them sold under the hammer.
City Sales had four apartments on offer and three of them attracted multiple bids with a single bid on the fourth.
The bidding was quite lively on a 50 square metre, two bedroom unit under hotel management in the Celestion building on Anzac Ave in the CBD. But even so, it took some tough negotiations with the overseas vendor to get it across the line.
Although the other three all received bids they were all passed in for sale by negotiation, with one of them selling the following day.
There were also four apartments on offer at Ray White City Apartments weekly auction and three of them could have appealed to owner-occupiers, while the fourth was a studio in the Amora building on Greys Ave, which is not managed by the hotel that operates from the building.
Although there were potential buyers in the room, several chose to stay on the sidelines and three of the apartments received a single bid each with one receiving no bids.
By the end of the auction only one of them had sold under the hammer - a spacious two bedroom apartment in a character building on Emily Place and the other three were passed in for sale by negotiation.
Clearly there are active buyers in the market at the moment and there is a reasonable selection of stock on offer. However buyers are being extremely cautious while vendors are often reluctant to admit the market is not as buoyant as it was a couple of years ago.
That is often making for very tough negotiations during or immediately after auctions, and vendors with unrealistic price expectations are likely to be disappointed while potential buyers feel they can take their time because if they miss out on one property, another one will come along that suits them just as well.
Details and photos off all of the properties offered at both auctions and the prices achieved on those that sold are available on our Residential Auction Results page.
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41 Comments
Rubber hits road.As appartment sink in Aussie, fhb head over for better jobs and cheaper houses. Its ok we can just import more foreigners untill certian suburbs feel like parts of India or China. Probably already happened in a few Awkland burbs.
Just get on with the reset.
Seriously?
An auction is over the second the gavel hits the block or is 'passed in'. Over.
After that, it's a Negotiated Sale. That we have allowed the auction process to morph into 'within 48 hours of the auction process failing' as 'Success at Auction', is a marvel of the current age....Why not make it 3 days or a week or 10 years? At some stage an asset that fails at auction will sell, so why statistically discriminate agains the ones that take 10 years?!
You are right. They use the auction paperwork for as long as possible after the auction. It is favourable to the vendor and unconditional. Whenever I have negotiated after auction, I have refused to use the auction paperwork. They usually tell you that it is all that is available at the moment, to which the answer should be, "Just get a blank S&P agreement and I will show you how to complete it!"
It matters because it gives a false impression of what has occurred - that a spirited auction process under 'open cry' has resulted in the best bid winning, when in fact that is not the case.
As with much to do with the property 'profession', it rests on LIES to accomplish its objective. Be that The Auction process; the "Intention" of Holding a Property that sells (tax evasion in other words), or just the plain old 'mistakes' that are made in reporting the facts.
No, it isn't.
Once the bidding from the floor has ended, the auction is over.
Going into the back room to be beaten about the head by the selling agent ( the buyer AND the vendor) to reach a negotiated price IS NOT an auction. It is a negotiation. That it happens with 1 second or 10 years of the auction finishing is irrelevant.
Hi bw,
Remember that "back room" negotiation wouldn't take place without the auction.
I would say that the "back room" negotiation is part of the wider auction process.
My neighbours recently sold their house a few minutes into "back room" negotiation. They say that they "sold at auction" and for all intents and purposes that's what they did.
And by the way, negotiation doesn't have to happen in the "back room". It can take place on the bidding floor.
TTP
"I would say that the "back room" negotiation is part of the wider auction process"
WRONG!
They are part of the Sales Process, just like the Auction is, or the "I'll take a hammer to your kneecaps if you don't buy this property" procedure( also known as The Back Room discussion !). They are all part of the Sales Process.
The Auction Process finishes when the hammer falls or the property is passed in.
And what's with this "Vendors' Bid" charade?! It's part of the scam that the community accepts as part of the Auction process ( B&T excepted I believe. Smarter than the others!). Vendor Bidding is outlawed just about everywhere else, in all markets, for any of many reasons. That it occurs here is disgraceful.
The agents will try and convince the buyer that the auction is still on for a set period. I'm not sure but there may be some fine print that the vendor has agreed to regarding the terms of the auction still being in effect for a certain period after the actual auction. If a buyer tries to insert conditions he will likely be rebuffed and have to wait 48 hours or something before submitting a conditional offer.
From memory (and I've been unable to find the link in the past, unfortunately), Interest reported 2-3 years ago, when auction rates started flagging, that the reporting basis was changed from only including those sold under auction to include those sold within a day of the auction. If my memory is correct, then it's not true to say these figures have always included negotiations. If anyone has a link to support my memory I'd be delighted.
This auction article from 2017:
https://www.interest.co.nz/property/86010/barfoot-thompson-sold-40-thei…
Directly under the Venue Results Table:
*Sold means sold under the hammer or by 5pm the following day. Not sold includes properties that remained unsold by 5pm the day after the auction and properties that were marketed for sale by auction but withdrawn from sale or postponed before the auction commenced.
Doesn't have the same disclaimer on this July 2018 or most recent result.
https://www.interest.co.nz/property/95051/sales-rates-ranged-25-71-barf…
https://www.interest.co.nz/property/97091/barfoot-thompson-had-more-pro…
I consider it a 100% sales rate, its just that the owners bought their properties back with unrealistic reserve expectations,.Possibly due to the amount they actually overpaid for them in the first place at the "top of the market", or owe the bank! The market has spoken.
It seems strange to me that people even bother with Auctions at the moment. But then I saw this very interesting point on youtube . Does anyone know if this works the same way here in NZ ? Go 14 minutes into video.
https://www.youtube.com/watch?v=3qiUN_lUw4c&t=198s
Post-auction sales are also cleverly sneaked in as Sold at auctions just to puff up the figures.
Why not claim 100 % Sold by saying Vendor bought the unsold property .Vendor's bid is there.
Leave it to RE agents to find ingenious ways to waddle around & dress up the figures.
If the Vendor has to pay for the Auction, they should stop Auction, unless the property is extremely good and reasooably priced.
Have seen few properties that have been bought by investors in last 2 - 3 years and really struggling to sell without a lose as pais high price in the first instance (Where every price was justified). Those who are able to hold will hold but many will have to sell and that too at a lose.
If the Investor/speculator has been in buying/selling since number of years and have flipped number of properties, is fine for them as must have made profit in earlier flipping and lose in last , whichwill be adjusted overall but those first timer's will suffer or caught up at the end of the boom.
Next stage, buyers drop prices. Unless this week's loosening of restrictions brings out more first home buyers willing to pay current asking prices from January. Could just be delaying the inevitable though. Why keep it going when prices need to drop to improve affordability?
Some odd variation appearing in the price vs CV on the recent auction results.
WEST HARBOUR, 17 MAGDALEN PLACE, Bedrooms: 3, sold for $575k on a CV of $740k.
TAKAPUNA, 33 HORORATA ROAD Bedrooms: 5, sold for $1,580k on a CV of $1,825k.
That Emily Place apartment for $525k for 71sqm doesn't seem a high price either, with others out in the market trying to get more than $10k per sqm.
The West Harbour place needs a bit of doing up. Ye olde 'Diamond in the rough' so knock off a hundred grand. Also last sold in 2006 for 303k so still a good increase for the vendor.
This is the sort of place I have been advising FHBs to seek out. Do-ups that last sold a few years ago.
The Takapuna one sold for 683k in 2007 so 1.580M is a great price now. Very well presented. They may have spent a bit of money on it. 900k in 11 years is well over $1,500 a week appreciation.
He sees it every day as he enjoys the property and thinks my, what a lovely home i have here, i think i may wonder down to the beech and enjoy a soda later as the day cools off, walk the dog and such. Later ill crank up the BBQ and get some lamb chops fired as the light falls away. He can sleep easy knowing his kids are getting an outstanding education and good nights sleep in the quit culdesac house that he has always dreamed of.
He may fly a NZ flag because he is thankful to live in such a beautiful country.
And news out of Australia ....
"Sydney-based private lender Mortgageport has turned down loan applications from apartment buyers for developer Ralan Group's Gold Coast apartment project Ruby, following a decline in valuation of up to 30 per cent for some apartments."
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