What do you do if you want to sell via public auction but your home makes a shoebox look palatial? An in-room auction may be the answer.
Residential property auctions have many fans. Advantages over private sale listings may include:

  •  Multiple bidders compete simultaneously and publicly for a desired property, often resulting in a sale price at or beyond vendor expectations.
  • An auction date draws a clear line in the sand, telling buyers “this home will be sold” unless you raise your hands.

What is an in-room auction?

Not every house, unit and townhouse is a good candidate for an on-site or “street” auction.

An in-room auction – where the actual auction is held at another site – can prove an excellent alternative, says Real Estate Institute of Australia President Peter Bushby.

 

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“Some properties and sites are just not feasible to have people on-site,” Busby says. “It may be rented, it may be a privacy issue or it may be because of unpredictable weather.”

Who does it work for?

State or mortgagee auctions are often held off-site. Some properties – particularly inner-city flats and apartments – are too small to host auctions with crowds of 100 in their lounge rooms.

“The fact is they work just as well off-site as they do on-site just as long as all the other sales and marketing activity is conducted to support the auction so that it reaches its target market of buyers,” Bushby says.

“The actual location honestly doesn’t make any difference to the end result.”

Some properties – particularly inner-city flats and apartments – are too small to host auctions.

Ray White Group Chief Auctioneer New South Wales James Price has conducted more than 2000 in-room auctions in his four years as an auctioneer.

His highest sale price on record was $18 million at an in-room auction, and the most he has auctioned in one session was 38 individual homes.

The method of sale is efficient and cost-effective for both home sellers and agents, he says.

“The reasons you may have an in-room auction include the fact it is an alternative you can offer vendors to onsite auctions on a Saturday,” Price says.

“It means that if you own a flat with no heating, are selling in winter, it is next to an airport and derelict, we can run a sales campaign and in-room auction and can ensure a crowd in that room.

“I think it is very important to offer vendors and the market that choice.”

Price says there are benefits of in-room auctions.

 

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3 benefits of in-room auctions

  1. Control over variables including the weather, traffic noise or lack of parking;
  2. Big opportunity to showcase a property using “slick” audio visuals pre-auction;
  3. As multiple in-room auctions are held in one timeslot – usually four to eight – each property’s auction will be witnessed by more people than a standalone on-site auction and that means greater crowds of prospective buyers.

“There are great benefits for a vendor because you can capture all that cross-through buyer traffic,” Price says.

“I was auctioning eight properties at one event recently and there was a buyer there who bid at six of them.”

What does an in-room auction cost?

Costs of an in-room auction are on par with a traditional on-site auction.

Expect to pay between $100 and $400 for a pre-auction short promo of your home’s features (fewer than 60 seconds) including high-resolution colour stills images and a voiceover.

The auctioneer will cost about $300.

“To be most effective, vendors have to be prepared to invest in a professional audio visual presentation, as it is so important with in-room auctions because prospective bidders cannot physically walk through the property on the night and they need a quick reminder of why they need to buy your home.”