Closing the Vendor-Buyer Gap
August 12 2022
There’s an interesting dynamic playing out in the auction arena as the property market normalises following an unprecedented period in Australian real estate.
In the latest Apollo Auctions report, director Justin Nickerson highlights the gap that has emerged between the price vendors want to achieve and what buyers think they should pay.
Buyers who acted with extreme FOMO (fear of missing out) last year have been replaced by buyers with FOOP (fear of overpaying) in 2022, the report explains.
Buyers with FOOP tend to make low-ball offers based on an unrealistic assessment of the current market – but it’s rarely a winning strategy, according to the seasoned auctioneer.
“Many buyers in most markets understand that their current lending limit won’t last forever, so they are keen to transact and are bidding at fair and reasonable price points,” Justin explains.
On the other side of the equation, some sellers whose price expectations sit too far above the market are seeing their properties passed in.
“Our auctioneers are reporting that vendors are slowly catching up with the changing market conditions, however, a fair cohort of sellers are still hoping to achieve a result that may have been possible last year but is not likely now,” reports Justin.
“The main vendor variant is still sitting above market feedback, dwelling in the emotion of a friend, neighbour, or enemy that sold a lesser home for more last year.”
Auctions remain an effective and transparent means of transacting during a shifting market, adds Justin, who notes bidding activity remains strongest in South East Queensland.
“Although buyer numbers lack the depth of 2021, this smaller group have adopted an assertive mindset with many transactions occurring as a result of direct bidder-seller negotiations during the auction,” the report concludes.
July Auction Results
Auctions This Weekend
Eoghan Murphy and Bree Bellhouse will be showing buyers through 21 Matilda Street, Burleigh Heads at 12pm tomorrow ahead of Sunday’s 10am onsite auction. The original house on a flat 665m2 block presents exciting potential for renovators and investors.
Our agents are working closely with vendors to provide up-to-date appraisals based on current market conditions and advice on how to best position your property for a premium price.
Reach out if our team can assist you in any way – we’re here to help.