澳洲Australia property Vendor Bid at auction. Why??? | Sydney

在澳大利亚


Just wondering: What is the go with VBs? Does anybody take any notice of a VB at auction? It just cracks me up when I hear an auctioneer say the vendor's will buy the property back for $XXX. Well treat yourself vendor :)
Also, if you are the highest bidder at an auction I belive you have first right to negotiate a contract for the house. Does this still hold true if you get beaten by a VB? I'm in QLD incase the practice is different Australia wide.  

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Often a Vendor Bid will be the last bid at a failed auction so that the Agent can truthfully claim to potential future buyers that bidding "reached $380K!!" rather than the paltry $320,000 that the last REAL bidder came in at.  

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But Duncan, that's telling a lie. Forgive my naivity regarding auctions...but I don't get it. The auctioneer is not telling the truth. Could you elaborate please?

cheers
Sharon  

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sailor said: ↑
But Duncan, that's telling a lie. Forgive my naivity regarding auctions...but I don't get it. The auctioneer is not telling the truth. Could you elaborate please?

cheers
SharonClick to expand...
Sharon, goodness gracious an Auctioneer/Agent not telling the truth? :)

Auctioneers like to finish on a positive and be able to, semi-truthfully, claim that some good bidding was had and that their entire marketing campaign wasnt a complete flop.. they dont distinguish between vendor bids and real bids when reporting what the bidding at Auction actually got to..

If it sucked.. they can throw in a vendor bid at the end so that they can have at least a grain of truth to cling to when their complete lack of morals has them telling subsequent buyers what the bidding actually got to.  

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Thankyou Duncan...I'm disappointed in many REA's and this titbit just confirms it.:(

cheers
Sharon  

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i think that there is a new law coming out(or already came out) which will require every participant to register prior to the auction to prevent VB's and bogus bids
it was in octobers API  

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sailor said: ↑
Thankyou Duncan...I'm disappointed in many REA's and this titbit just confirms it.:(

cheers
SharonClick to expand...
It was pure speculation, not even an anocdote. Don't be convinced so easily. :)  

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I don't see anything wrong with a VB. It is identified as a VB, both at the auction and in the paper the next day. It also declares what is effectively a private sale price so any interested buyers know the asking price rather than being in the dark.

From the vendor perspective it would be absurd not to declare a sale price if the auction fails, auction campaigns are expensive so what would be the point of sending everyone away without giving an asking price.  

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duncan_m said: ↑
they dont distinguish between vendor bids and real bids when reporting what the bidding at Auction actually got to..Click to expand...
Don;t know what the law is in SA but in Vic that would be illegal. VBs must be identified as such.  

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mdk92 said: ↑
Don;t know what the law is in SA but in Vic that would be illegal. VBs must be identified as such.Click to expand...
Yes, I should have added that every state has different rules.. Vendor Bids must be identifed as they occur, but I don't believe subsequent reporting of the auction needs to state whether the final bid was a vendor bid or not.  

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Wow, I didnt know that. The things you learn aye?

RJ  

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duncan_m said: ↑
Yes, I should have added that every state has different rules.. Vendor Bids must be identifed as they occur, but I don't believe subsequent reporting of the auction needs to state whether the final bid was a vendor bid or not.Click to expand...
Yes, probably doesn't need to as newspapers wouldn't be bound by RE laws I guess, but in practice VBs are identified as such in the paper.

Whether the REA later identifies it as such I don't know, yes it is easy to speculate, but in the absence of evidence I'd just apply the normal "buyer beware" princple and not take anytihng an REA says for granted. Part of the DD process should include finding out if a property for sale has just been passed in at an auction. In parts of Melbourne this is easy to spot because in these parts almost everythign goes to auction.  

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bamute said: ↑
Also, if you are the highest bidder at an auction I belive you have first right to negotiate a contract for the house. Does this still hold true if you get beaten by a VB? I'm in QLD incase the practice is different Australia wide.Click to expand...
imho.
Bamute,yes from my understanding that is the way it works, but the problem
with auctions in QLD is the vendor or by his auctioneer
can bid as often as she or he thinks fit.
I have been to several house auctions in Brisbane over the past months
and every property was passed in on below the reserve a simple way is
ask the auctioneer after you are issued with your bidder's card for a copy of the conditions of sale.
The highest bidder for a past in lot has the exclusive right to negotiate until the end of the auction or any other time specified by the auctioneer.
good luck willair........  

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i find vb's frustrating - the market says that a property is worth $x, but by raising it with a vendor bid right at the end by (i have seen) up to $100k is telling you what the vendor actually wants ... and then all the potentials buyers shut up and laugh "as if" all the way home at what the vendor wants.

i would rather the vendor bid not exist and that a property is either sold or passed in. this gives a true reflection of the market.  

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bamute said: ↑
Does this still hold true if you get beaten by a VB?Click to expand...
This is a interesting way to look at it, no one is beaten by a vendor bid, the "race" didn't even start.  

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mdk92 said: ↑
Part of the DD process should include finding out if a property for sale has just been passed in at an auction. In parts of Melbourne this is easy to spot because in these parts almost everythign goes to auction.Click to expand...
We used to carefully look through the "For Sale" sticker on the signboard - this will show the date the property went to auction.

We'd then go back to the copy of "The Age" from that weekend and look up the pricing.

Yes, the VB's are used very well to hide the real bidding, but I guess that gives an idea of what the vendor is looking for (if the reserve is not disclosed)

Cheers,

The Y-man  

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If the property went to auction ask the agent if it was a vendor bid. Agents I've spoken to will disclose that.

What annoys me are the ads asking for offers over $x and you then find out the Vendor has absolutely no intention of accepting $x plus $1, but insterad want $x times 120% minimum.  

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I once attended an auction where there were only 2 bids (both vendor bids by the auctioneer). First VB was $300k, to get the ball rolling. Still no response from the crowd, so what does the auctioneer do? He increases the VB by $10k to $310k. He was bidding against himeself. Couldn't quite work it out :confused:

Ozi  

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ozi said: ↑
I once attended an auction where there were only 2 bids (both vendor bids by the auctioneer). First VB was $300k, to get the ball rolling. Still no response from the crowd, so what does the auctioneer do? He increases the VB by $10k to $310k. He was bidding against himeself. Couldn't quite work it out :confused:

OziClick to expand...
This is very normal, I'm surprised it was only a $10k increase as the first VB is usually to get the ball rolling in an auction, but when that doesn't work the last VB is to effectively declare a negotiable reserve.  

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mdk92 said: ↑
This is very normal, I'm surprised it was only a $10k increase as the first VB is usually to get the ball rolling in an auction, but when that doesn't work the last VB is to effectively declare a negotiable reserve.Click to expand...
Yes I figured this might be the case. It just amuses me ;) Ahhh the tactics agents will use...

Regards,
Ozi  
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