- How’s this for a challenge? Auction a fire-damaged property in a small country town that had already sat on the market for years… with $0 for marketing!
- Guess the result: our online auction attracted ___ active bidders and the property sold for ___ times the amount the local agent said he’d ‘consider a miracle’.
- Are you underestimating the potential of the online auction and the great results being achieved with the SoldOnline platform? Read on to see if your guesses were correct!
A no reserve auction? For a property? Most of us are hesitant to set the ‘no reserve’ option on our used clothes or the kid’s old sports gear on eBay – who on earth would sell a property with no reserve?
Paul Kelly of Moree Real Estate, that’s who. Paul had a property on his books that was considered unsellable – a fire-damaged theatre, bar and grill that had sat on the market for years. That meant everyone in town (population 7,383) likely suspected it had problems even beyond its status as a burned-out shell.
Even developers weren’t biting – despite its prime position on the eastern side of Moree, the demolition costs to tear down and clear away what remained of the old cinema would be considerable. They wouldn’t have left much room in a developer’s budget to pay anything but a tiny price for the property itself.
Still, Paul saw potential. The fire had destroyed the bar and grill, but the theatre was mostly intact. It also sat on a large block along the Moree bypass, which two million vehicles drive past every year. Maybe someone would fall in love with the theatre and want to restore it, if only they knew it was there. But how to attract that special buyer – one who could see the potential, not just the damage – when the owners had $0 for promotion, so Paul could only afford to market to his database and occasionally place a small local newspaper ad?
That’s when Paul called to ask if I would be interested in running a no reserve auction on SoldOnline. I was nervous because I didn’t want a total failure (like selling a 1,2421m2 property for one measly opening bid of $500) on our record, and this theatre had been sitting abandoned for years without a peep from interested buyers. Still, if SoldOnline could find a buyer at a reasonable price for such an ‘unsellable’ property, that would be something to brag about; and Paul told me if he got just $10,000 for it, he’d consider it a miracle.
It’s fair to say Paul talked me into it. (You can see the property here, by the way). But the early signs were good – the ‘no reserve’ auction immediately had the local area buzzing. It even got media coverage well outside of Moree – no marketing budget required – and people started registering to bid on the site. We started the auction on a Thursday, but by Tuesday morning, with the auction set to end just before 3 pm, we were still at two bids, selling price $1,000. It was looking like the flop I’d feared it would be – or was it? At 1 pm, four more bids had upped the price to $3,000. A few more $500 bids came in until at 2 pm, someone got serious and bid $26,000. Amazing! Even more amazing? In the final five minutes of the auction, the price jumped again to $50,000, then $55,000, then $60,000, until it
We didn’t just sell the unsellable property; we sold it for 6.5 times the maximum the agent hoped he might be able to get for it! A total of six potential buyers placed bids – by widening the net with an online auction that anyone in the world could take part in, we attracted bidders who otherwise never would have known the property was for sale.
Now, this doesn’t mean I’d recommend a no reserve auction to anyone else. This was a property that had sat on the market for years and was costing the owners money to keep. They just wanted it off their hands, and the incredible sale price was a completely unexpected windfall. But it was also a unique offering; a country-town cinema, the kind of thing that might attract an out-of-towner looking for a lifestyle change and an interesting project. I’ve auctioned over 35,000 properties, and I can’t think of many others that were in such a bad way but had the same potential to become something really special.
Why share this story?
So, if I can’t recommend a no reserve auction for 99.9% of properties, why tell this story? (Other than it’s a pretty great story, and SoldOnline sure came out a winner!)
Because I had my doubts. I had them before we listed the property online, I still had them once the auction got started, and it was only in the last hour of the five-day online auction that my fear was replaced with excitement and elation (and you could have knocked me over with a feather when the hammer fell at $65k!) If it hadn’t worked out, my reputation could have taken quite a hit, but instead the great sale price was the talk of the town. I stepped outside my comfort zone big-time on this one, and I ended up happy I’d done it.
That’s the real takeaway I want you to understand as an agent. It’s easy to say ‘this is how we do things, why change? Why even bother trying something new?’ Well, because you might get unexpectedly amazing results, that’s why. Our no reserve auction success gave both Paul and I (and SoldOnline) a great reputation boost – if I’d given in to my fears and said ‘sorry, that’s not how I do things,’ we would never have achieved such a brilliant result.
No reserve property auctions are probably never going to become common, but online auctions sure are – so what’s stopping you from getting on board? If an online auction isn’t right for a particular property, you still have the traditional options available to you, but the online auction is another powerful tool in your sales kit that you want to have, and soon you’ll need to have it, or you’ll be left behind – so don’t give in to your fears and say ‘sorry, that’s not how I do things’ – give it a try, even if it does mean stepping out of your comfort zone.