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Agents Zoom in to keep auctions alive

Business

SA auctioneers are turning to conference call app Zoom to put houses under the hammer, as real estate sales slow due to COVID-19 restrictions.

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About 50 auctions per week were held across Adelaide in the first half of March before COVID-19 restrictions forced them to take place via online bidding or phone.

There are just 15 upcoming real estate auctions listed on the Society of Auctioneers and Appraisers website to be held until May 26.

Of those, 12 are scheduled to be conducted via Zoom.

John Morris is head auctioneer for Ray White in South Australia and has been conducting the majority of Zoom auctions.

He said these auctions had attracted an average of 4.5 registered bidders and achieved clearance rates of just under 50 per cent.

“The agents are embracing it and getting the bidders so it’s really working,” Morris said.

Real Estate Industry of South Australia president Brett Roenfeldt, who is also an auctioneer, said holding auctions online was much more difficult, particularly for buyers, resulting in fewer auctions.

He said there were a variety of different platforms that agents had used including Auctions Now and Gavel, but a lot of agents were turning to the conferencing app Zoom, which gives registered buyers and the auctioneer the opportunity to see each other on the screen.

“You perform your auction and it’s a very user-friendly way of doing an auction in this current environment,” Roenfeldt said.

“It does work pretty well and a lot of the buyers are more comfortable because they have utilised the Zoom platform previously for conference calls with work colleagues so it’s not foreign to many people.

“Some platforms are a little more difficult to use especially when it comes to registration than others and can lead to hesitation around bidding.  In this marketplace you’ve really got to try and use a platform that the agent is comfortable using, the auctioneer is confident using and that the buyers don’t feel threatened by.”

REISA conducted two surveys of its members in April showing that sales and listings had dropped on average by about 50 per cent for the month. It expects that figure to trend down to 60 or 70 per cent in May.

Roenfeldt said a number of properties were still being brought to market under auction conditions but about 60 per cent of them were being sold prior to auction day.

“What’s happened is the agents have used the auction system to find the buyers prepared to offer a price that is acceptable to the vendor under auction conditions and have chosen to sell before rather than take it to auction,” he said.

“It’s bringing everything to a head in a very quick time and in this climate in particular, no vendor wants to be sitting there for several months just testing the market.

“In the auction process things to happen in a short amount of time but very importantly, the vendors want certainly and to be able to get a cash unconditional contract with no cooling-off period gives them that certainty.”

Winter is traditionally the quietest season for the real estate industry with spring the busiest.

Roenfeldt said if COVID-19 infections continued to decrease he expected some easing of rules for the real estate industry in early June but suggested it would likely be a staged process.

He said he expected the industry to return to traditional auctions in the field as soon as possible.

“Once the easing of restrictions occurs it may well be in the initial stage that the government may allow us to do on-site auctions utilising social distancing and only having registered bidders at the auction but I cannot see the South Australian industry moving online longer term,” Roenfeldt said.

“When you look at the eastern states and in particular Sydney, they have been used to online platforms for a long period of time so there are still a lot of auctions going on because they are comfortable with the online platforms.

“But even looking at Sydney’s stats, there are an enormous amount of auctions that are selling before auction day.”

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