A most unusual auction

I had a look at Queanbeyan. There seems to be an older part in addition to some newer areas. Some of it looks really ordinary looking, or is Canberra turning me into a snob. Very close by were some spectacular spots in Dodsworth and Ridgeway. Million dollar properties some of them, no doubt. I went to some open inspections in Jerrabomberra. What a name for a suburb. Large houses with prices to match. Some of them nearly take your breath away in the way they have been built and fitted out. I called in at an auction that happened to be about to start. I was first there, and had a chat to one of the agents.

On the way through the door I mentioned that I’d be a spectator only, and asked the price that the property was expected to bring. “Mid three hundreds,” she said. It was a very nice place, enhanced by the modern furnishings, if not a bit cramped inside, and the building almost filling the block completely. Anyway, while waiting for the auction to start, I began chatting with a couple of people outside, and mentioned the morsel of information I got from the agent. I was unaware at the time that this particular couple would buy the property. It was one of the most unusual auctions I’ve ever witnessed.

The auction began in the usual way with the auctioneer running through various attributes of the property and as far as I could tell seemed just another ordinary property auction. It’s the events which followed that surprised me. There were about three other agents on site in addition to the auctioneer, and they, along with a small group of perhaps ten or so spectators gathered on the small patch of lawn to the side of the house. There was only one interested buyer, as it turned out. Or rather, there was only one individual who was vocal at the auction. No one else showed any interest in bidding.

The bidding commenced at $300,000 with this chap calling out his bid. There were no subsequent raises in the auction despite the auctioneer’s usual banter of talking up the property. It appeared that this person had turned up to the auction and had no opposition. To me this is an ideal situation: it keeps the price low. And if the property gets passed in at the end of the auction, the highest bidder generally has first rights on negotiating a price, in private. Which also, is an ideal situation for a buyer. It has been known for properties to fail to sell at auction and subsequently sell at a lower price. The reverse also occurs.

So, here we are all gathered at this auction and there is only one bid, and that bid is for $300,000. One of the sales team approaches the bidder and speaks to him. I’m a little too far away from them and I don’t hear everything that was said, but I did manage to catch a comment by the sales person along the lines of, “…so you will be willing to raise your offer by $30,000.” This whole process took about three maybe four minutes; which is a lot of time to be standing around in relative silence. I thought this was an auction and not some badger-the-punter session.

My first reaction was wondering what this sales person was doing speaking to this guy. I’d feel inclined to tell them to get lost. My second thought was over the word “offer.” This guy didn’t make an offer on the house; he made a bid at an auction. Perhaps I’m splitting hairs, but it did seem mighty strange.

Anyway, this sales guy goes back to the auctioneer and whispers in his ear, to which the auctioneer immediately addresses those assembled, but to the bidder in particular. The auctioneer immediately asks to hear the new amount as a bid. And sure enough, like the little sheep he was, he responded with, “$330,000.”

This guy had just bid against himself. This was stupid, was my first reaction. This was outrageous of the agents to push this guy like this. Of course, the property may in fact have been worth a whole heap more than this amount. So, perhaps bidding against himself was no great loss. On the other hand he has just committed himself to another thirty thousand that perhaps he may not have had to put up. This guy doesn’t know the sellers situation. Perhaps the seller was in urgent need to sell; perhaps the property had to be sold on that day to get out of some financial trouble. We don’t know that possibly the seller had instructed the auctioneer to sell it any price, just get rid of it.

Having just bid against himself, the same salesperson approached the bidder again. Another prolonged discussion took place. Further delays as sales folk disappears inside the house. Possibly the owner was inside and they were seeking instructions from the owner. They come out for more discussions with the bidder. They troop back inside the house again. This would be funny had everything been captured on video and sped up like an old Keystone Cops silent movie.

Then finally they emerge and the figure $363,000 is announced by the auctioneer. The bidder acknowledges it. Then as quick as a flash, as though allowing no time to retract the bid, a mighty fast, “first call,” and without pause for a breath, “second call,” and immediately, “third call, sold,” exploded from the auctioneer’s mouth. It was all over

Unusual practice at best, more like a con job to me.