Dating back to the Roam times, the auction system of marketing and selling real estate is not a new innovation. However, the process and efficiency of such selling systems have evolved over time and is now viewed as a desirable, fair and viable alternative to traditional private treaty or agreement methods of sale. The real estate industry itself has exerted influence to effect a movement towards sale by auction, with industry reasoning pointing to increasing professionalism among real estate agents and to achieve a better means for determining a true and fair price for the property. More and more sellers and buyers of real estate in New Zealand are discovering the benefits of auctions and accelerated marketing sales to achieve their objectives on their terms and their timelines.
There are various benefits of the auction system for both buyers and sellers of real estate in New Zealand. For the potential buyer, they are able to research the market in respect to both price and availability of alternative options, empowering them to be confident in their decision to bid once comparisons of market alternatives have been assessed. Information packs providing comprehensive reports on the property ensure that the consumer is well informed, ensuring the correct purchase decision is made. With the benefit of eliminating sometimes lengthy and stressful negotiation periods, an auction can reduce the time required to purchase a property in New Zealand. As the buyer can limit the amount they are willing to bid, they essentially determine the price paid for a property, ensuring that the process of competitive bidding results in a fair market value being paid for the property. As the purchase and closing dates are known, buyers are better able to plan for the acquisition of their new property, along with the requirements of finance.
For the seller, the confidence that the house will be sold at a true market value is reassuring, while quick disposal reduces the long term costs sometimes involved with selling a property in New Zealand. The auction process exposes the property to a large number of potential buyers, creating competition among buyers, which can often have the effect of exceeding the price gained under a negotiated sale. Eliminating numerous and unscheduled showings of the property is often well received by sellers. The seller is in control of the sale, whether it will be an absolute auction or an auction with reserve. Seller decides the terms of the auction, the day of the auction and the closing date.
One of the key benefits for both buyers and sellers of real estate in New Zealand under the auction process is that the usual limits of time and geographical space are averted. With the use of on online advertising through a real estate website, potential buyers are able to peruse the property 24 hours a day, 7 days per week. Additionally, the use of the internet diminishes geographical boundaries, with potential buyers being able to view, and sometimes participate in the auction, from nearly any location within the world. This can also reduce the cost of physically attending the auction.