Auctions were typically not popular among vendors in Whanganui, Steve Ellis said. Photo / 123rf
Auctions were typically not popular among vendors in Whanganui, Steve Ellis said. Photo / 123rf
One Whanganui real estate company is going to try auctioning off 28 properties in one day next month.
But one property pundit warns people trying to sell their houses under the hammer will need to be realistic with what they’ll get in a slow market.
The auctions are part ofProperty Brokers’ national Bid Day Out promotion, which Whanganui area manager Ritesh Verma said they hoped would bring some urgency to the market.
Seventeen of the properties going under the hammer are in Whanganui, while 11 are in Marton.
“At the moment, there’s a lot of motivated vendors that need to sell,” Verma said. “We’re trying to create urgency in the marketplace.
Harcourts principal Steve Ellis said auctions were typically not popular among vendors in Whanganui. He said his company sold just one house under the hammer last month.
“Most agents would like to do more [auctions]. But it’s just not that market in Whanganui.”
Ellis said there was a fear that if a property didn’t sell, it would be deemed a failure.
Ritesh Verma said Property Brokers was trying to create urgency in the market place. Photo / Paul Brooks
“We don’t see that at all - we just see it as part of selling the property,” Ellis said.
Auctions were transparent and buyers knew how much the competition could pay, while vendors could see if there was a value for their house, Ellis said.
“It’s a more exciting way to sell houses.”
But he said a concern would be that if there was not enough competition for a house, an auction could favour the buyer.
Verma said he was confident there were buyers able to put down cash, and unconditional offers.
Houses that are not sold at the auction will be opened up for buyers with conditional offers, Verma said.
Vendors were not going to take “low-ball offers,” Verma said.
“Vendors will meet the market. At the end of the day, it’s what someone’s willing to pay, and [vendors] certainly don’t have to accept anything they’re not willing to.”
OneRoof editor Owen Vaughan said the auction day would be a litmus test for where the Whanganui housing market was at.
OneRoof editor Owen Vaughan said sellers needed to be realistic to get their house sale completed. Photo / NZME
“We’ve come off a fairly tepid spring [and] lukewarm summer. There wasn’t much, really, in the way of buyer demand.
“Mostly because of rising interest rates, the cost of living - [there’s] a lot of hesitation out there.”
It would be interesting to see how many buyers are at the auctions and what types of properties are sold.
“Sellers should be under no illusion. To get their property over the line, they’re going to have to be realistic on their reserve,” Vaughan said.
Typically, auctions were a great tool in a sellers’ market, Vaughan said, where there were plentiful buyers and not enough houses.
“So that kind of market was the kind you saw in 2020 and 2021 where house prices were rising fast, there were not a lot of sellers [and] not much stock compared to [the] amount of people wanting to buy it.”
Vega residential and commercial financial adviser Natalie Sara agreed with Vaughan that auctions worked better in a hot market.
She said her first-home buyer clients were not looking at auctions because they had to have a registered valuation - at a cost of $800-$900 per house - to get approved by the banks to make an unconditional offer.
“It’s pushing them out of the market a little bit,” she said.
People selling their house and then hoping to buy would not be able to buy at auction as well, Sara said, because they needed to make offers conditional on the sale of their current home.
Sara said lending was not easy to get at the moment, and the fear of missing out from 2020 and 2021 was gone.
It was possible an event with so many auctions could be successful at getting more sales over the line, Vaughan said.
It was a good way to make clear the “breadth and depth” of the housing stock that was available.
The auctions are set to take place on Thursday, February 2 at the Wanganui Golf Club on Clarkson Ave.
