The best form of con is when the person taken advantage of has no idea that it has taken place. Some around my age might remember this as the theme behind the movie “The Sting”. Well just consider for a moment the much hyped success of auctions. Currently running at close to an 80% published success rate (another bit of trickery given that the real rate is closer to 70% after taking into account the unreported failed auctions), the hype and theatre surrounding the sometimes spectacular results would seem to justify the feeling that you’d have to be mad to use any other method; particularly when the market is strong.
Consider the real facts behind the puffery. Over the last 12 months, I have had cause to bid on 7 different properties at auction for friends, clients and family. On three, I was outbid. One of the three successful ones sold for close to $350,000 above the reserve. When the success rate at auction or the amount achieved above the reserve is the focus (and what else is ever talked about?), these results seem a compelling argument in favour of public auctions. But what was I authorised to pay on behalf of the buyer in the four I bought? On average, my authorised limit was exactly $260,000 EACH. Even the purchase which was so much over the limit fell short of what the buyer was prepared to pay by $49,000. That was the smallest gap. Seriously, from $49,000 to well over $500,000 in just these four sales.
When agents act for sellers, shouldn’t the focus be on what buyers are willing to pay, rather than what is simply enough to sell the property (ie. one bid higher than the underbidder)? The astonishing success in misdirection by agents generally, typically sells their owners short by eye watering amounts every single weekend. There is another way to ensure that the maximum price is achieved each time but it’s a bit more work and doesn’t facilitate the conditioning and advertising budget that is part and parcel of public auctions. It is called a Private Auction or Silent Auction (much like a tender).
When agents act for sellers, shouldn’t the focus be on what buyers are willing to pay, rather than what is simply enough to sell the property (ie. one bid higher than the under-bidder)? The astonishing success in misdirection by agents generally, typically sells their owners short by eye watering amounts every single weekend. There is another way to ensure that the maximum price is achieved each time but it’s a bit more work and doesn’t facilitate the conditioning and advertising budget that is part and parcel of public auctions. It is called a Private Auction or Silent Auction (much like a tender).