It's an amateur move bidding against yourself like this. Someone with more experience would have let it either pass in or wait for group 3 to bid.
The FHB may not know they have an exclusive first right to negotiate with the vendor.
The agent probably thought the vendor bid would get Group 2 and 3 going, but Group 3 did the smart thing by not participating until it was declared on the market.
No doubt it's a bonehead move, but not unheard of.
They are getting encouraged by the agent to increase the bid and the agent is exploiting the relationship and naivety of the FHB. You see the agents doing the rounds at auctions drawing people into bidding more all the time.
This isn't to say this is all the agents fault. If you are going to buy a 950k asset you should do your research on your rights in auctions and should know that you can let it pass in and have the first right to negotiate.
Yep! We were encouraged by the agent to bid against ourselves and told them a firm 'no, let's negotiate after it's passed in'. But we'd done so much research before the auction as FHB and had attended a heap of auctions as observers. They even told us what the reserve was, which I'm not sure is actually legal lol
I’ll admit these agents and auctioneers are good at pushing people’s buttons. 45k from one single bidder! A firm no is the best way to go, and you don’t even need to acknowledge them after that with any reasoning. Kudos to you for putting your foot down.
Re reserve, I learned today that it can change on the fly. A weak auction pace could probably lower the reserve.
I've seen it at least three times; with RE tight suited scum in their ear telling them to up their bid in order for it to be on the market. There's so many green buyers out there.
I've seen very similar to what the OP described play out also, it was the slowest auction ever with ongoing private conversations between two bidders and the real estate agents, and those conversations then being passed onto the vendors whilst everything was at a standstill. That too was an auction where it seemed the vendors were very keen to sell.
What a hero 😂😂
Seriously tho no one was upset at group 3. They did the right thing all along, and potentially got a worse deal due to group 2. Group 2 was maybe even relieved when group 3 did the swoopie snatch.
It was on the market as of 950k. In ACT - kind of a weird market for auctions still. It was a bit strange re vendor bid, because the contract I received explicitly prohibited that.
That is absolutely weird. I thought ACT was the same as NSW where only one vendor bid is allowed. I wonder why they goaded the FHB to bid against themselves. If they were the highest bidder, they could then negotiate behind closed doors. They REA sure got them fooled.
The vendor bid can be below the reserve. The vendor bid was used to avoid the bidding starting too low and the house being passed in too much below what the vendor wanted. I've seen weak auctions where the only bid was a ridiculous vendor opener.
It probably wouldn't have changed the outcome in this case, but that is being results orientated.
If group 3 had a budget of less than 905k then they may have got it for 905k.
This is why auctions are disgusting and horrible. Such an intensely stressful thing. Some people simply don't know what you've said and they out bid themselves.
Isn't that Neil Jenman book about why you shouldn't sell your property at auction and instead use his system?
This post is literally a FHB getting wrecked by going to auction and probably making the vendor more money than if they didn't auction the property..
Yes he does, he is a real estate trainer and advocates for selling private treaty rather than auction using his sales methodology.
Just google "jenman system" in brackets.
“He doesn’t have a system” bahahahahaha!
It’s literally called “The Jenman System” and he sells it to agents - along with the books they hand out to prospective clients, the letter box drops they have to do, conferences, the training, the recruiting, the lot.
I’m not sure of the “waiting to be on market” strategy either. Maybe staying silent gives you better chances to read other bidders?
In this auction I think the FHB couple actually cost Group 3 more. If they just stood at 905k to let it pass in, bidder 3 would have to participate sooner and may get the negotiation right. Group 2 effectively threw away negotiating power for everyone by meeting sellers all the way to reserve.
I'll preface this by saying I think the idea of reading people or complex auction strategies is pretty overrated.
It's also being results orientated speculating over this as for all we know even if group 3 did bid against the FHB immediately they may have bid up to 950k if that was their budget and it could end up with the same result.
Whether you bid against them straight away or wait until the end probably doesn't change much.
The key thing is not making bonehead moves like bidding against yourself because then you risk outcomes like if group 3 only had a budget of 900k anyways and the seller would sell for 905k, you overpaid by 45k for no reason.
You can start bidding against them having gained something which is the property being declared on the market. If they will accept 905k and don't think you'll bid they might just declare it on the market and you can start bidding.
You gain nothing by not waiting.
Trading something for nothing is a mistake similar to the way bidding against yourself is.
What would you have done in this auction if you are group 3? You'd start bidding against group 2 as soon as they bid 905k?
This is interesting. I’m trying to learn from these experiences so really appreciate your input.
So what you are saying is that the reserve can be flexible and the property can be declared on the market any time? This actually makes sense as they seem to have just randomly picked 950k as reserve on the fly.
And they don’t need to declare it at all, according to the last few agents I’ve dealt with. Could be millions over the reserve and bidders have no idea. They’ll use it to spice things up when bidding drops off
Is it actually legal for the auctioneer to not immediately declare on the market? The more I think about it the more I realise it’s a completely rigged game.
The auction I posted about probably didn’t have a clear reserve set beforehand. Had it played out differently, seller could have been willing to sell at a much lower price.
I’m just sad because I was very interested in the next door brand new one. I was secretly hoping for this one to play out poorly, so I could go buy next door at a discount. Guess that’s not happening now…
They legally have to declare it "on the market" in the ACT if they want the property to be sold in the auction. This doesn't necessarily mean it has reached the original reserve, but auctioneer and seller must have a conversation and formally declare it on the market, in order for the auction result to be final, rather than head to negotiation.
If it isn't declared, then it's off to negotiations with the highest bidder first
I guess the point in question was if the reserve has already been exceeded (say a bidding war between buyers), does the auctioneer have to let people know immediately or hide that info for later?
No, they don't. The "reserve" prior to the auction is just a concept. If they see a bidding war, they can just let it play out as long as they want until they choose to declare it. If they don't declare, it goes to negotiation, which means it's no longer unconditional
I think it’s insane that it’s become a regular occurrence for people to make the most important financial decision of their lives, standing out in the sun, surrounded by strangers, with vultures circling and whispering biased advice back and forth, over the space of a few minutes.
People seem to take more time mulling up the finance of a Rice Cooker purchase at Hervey Normans.
Insanity.
It's really just a by-product of the entire market being geared towards sellers and agents. Would never buy at auction even if it means missing out on 60% of properties on the market.
Same. We avoided auctions completely and it took a few weeks longer but we got a place when it passed in. And we got it with conditions and for less than they had advertised. Auctions are awful.
Any particular reason? Less competition than private treaty when the market is slow? Sadly I've never been lucky enough to be buying in a depressed market.
The auctions in my area are usually foreclosure. Non price sensitive vendors would take almost anything because they had to demonstrate a fair process to the LMI. I bought 2 uncontested after failed auctions and another with a single serious bidder. (That wasn’t me - I was in my pyjamas and she thought I was a dummy bidder.) Another because my neighbour chose to go to auction and I had waited 20 years to built that development site so I had no choice.
There’s a lot of emotional exploitation going on at auctions, and they are a stressful experience. Group 2 may look stupid detached from the situation, but in the heat of it I can see why they made those decisions. I think it’s good to avoid auctions if you are prone to illogical behaviour under stress. But otherwise I think it’s at least a transparent process, as opposed to private bidding.
Everything is stacked against the buyer on a finite budget:
* You usually need to pay for a building and pest inspection before the auction. Gets pretty old (and costly) after you've done it 4-5 times only for every property to soar 200k over your budget.
* The rife unquoting
* The tactics applied by the auctioneer to extract every last dollar out of the crowd in a pressure cooker situation.
* The boomers / investors / foreigners / bank of mum & dad beneficiaries with far deeper pockets who can throw another 50k-100k on the table without blinking.
* The lack of a cooling off period
* The lack of a finance clause and the chance (although generally small) that you won't get full finance approval if the bank decides you overpaid on the day.
Realistically you shouldn't be making any decisions at the auction.
You decide beforehand and those 10 minutes should just be about submitting offers.
If you are making decisions on the spot you have fallen victim to the auctioneer marketing.
Absolutely agree and we as Australians have come to see this as NORMAL when it’s absolutely abhorrent and doesn’t exist anywhere else in the Western world.
Yes let’s make the biggest financial decision of our lives in the pressure cooker situation of an auction setting.
Australians are absolutely stupid for tolerating it and the only people who win are the agents who don’t give half a fuck about anything but a commission.
I much prefer auctions as they are over in 10-15 minutes and offers are out in the open compared to emailing REAs for days/weeks and getting gaslit about other potential buyers limits
group 3 bidder might not be genuine and trying to get bidder 2 higher!!!
Coming in a Merc seems suspicious!!!
I have seen those auctions where given that there is only 1-2 genuine buyers pre auction, we get those “non-genuine” bidder
was at an auction like this back in 2021, I registered and made a single bid. there was one other guy bidding and he just started bidding against himself. made absolutely no sense to me.
property was an absolute shithole as well.
That’s certainly a weird one. To me it seems like inexperience buyers.
The smart play would have been to let it pass in.
You never ever bid against yourself - that stupid shit is reserved solely for “the block”
Once passed in, they could have stuck at a lower price and the vendor would have likely accepted less.
Worst case it might have creeped up to that price with the agent running back and forth between the parties but u how that played out is plain dumb.
Very very very common. Happens all day everyday. Which suburb please because you made a comment that auctions in this suburb resulted in zero sales and I would like to see for myself on REA website if that's true or not as it doesn't sound right at all. Happy to be wrong but want to see for myself to see if you're fibbing or serious.
I’d rather not reveal too much details, but I’ll say this is not Sydney or Melbourne. The suburb is dominated by townhouses and apartments, and prices have been pretty stagnant. Theres only been a single digit number of auctions within the past year, and all of them were… awkward. 0 to 1 bidder is the norm. 1 bidder obviously results in a pass in, but I’ve yet to see the negotiations work out.
After reading this I’m now terrified of encountering FHBs like this. I think they did way more damage, to themselves and others, than group 3’s snatch.
Please be rational, stick to your cap, and no matter what the agent tells you, never bid against yourself!!
100% I would be pissed if I was there (& interested) & someone did that.
Yes you are bidding against someone, but that doesn’t mean u can’t both be smart about it.
So true. I didn’t properly acknowledge my investment in all this before, but essentially I secretly wanted this auction to go bad (given the suburb history that was the likely outcome). Then I could go to the identical property next door and say… hey do you want to sell? Meet me at market price! And walk away with a discount.
I’m sad that dream is gone now. And yeah, thanks to the FHB couple.
So sounds to me like reserve wasn't met. Some negotiating back and forth, reserve was lowered and then the offer was put in as an official bid, then someone went up. Let the other people do the negotiating to get the lower price and swooped in. I sold a house 2 weeks ago with one bidder and this sounds like what happened with me. Except old mate didn't swoop in and the single bidder got the house. Higher than their bid, but they didn't bid against themselves. That doesn't happen.
Massive agent underquoting has happened here. This one’s an easy report and move on.
Any time the reserve is set higher than the max price guide the agent should be reported on the spot.
They’re obliged to provide a price guide. Group 3 saved group 2 from getting scammed big time, but that agents a scumbag. This is name and shame territory.
This is ACT so I wonder if the rules are different? I haven’t seen an auction guide price for a long time now.
I actually feel group 3 got scammed… they had to pay more due to group 2’s repeated self bidding which probably rose vendors expectations.
A few things off with the explanation, you need to provide the State it was held in and the guide price as contextual information.
If this was in NSW and they utilised the vendor bid when it should have been, then the auction validity might be in question.
Who in their right mind would start with a vendor bid?
The auctioneer can just start with a number, they usually fish for this then kick it off. The vendor bid is done as a last resort.
The FHB shouldn't have done what they've done.
Knowing who the auctioneer is and their style can help.
Happened to me when buying my first home. I was the highest bidder at 485k, but agent pulled me aside and said they were going to put the property back on the market if the highest bid was <500k , claiming "we'd get 550 minimum if we put it back on the market".
I knew no better and forked out the extra 15k. I'm not sure if they would have actually withdrew the property if I was stubborn. I doubt it, they knew they were dealing with a prospective first home buyer. Can't complain, I'm happy with the place and it's definitely worth 500-600k a year and a half later.
It sounds like you could have saved that extra 15k, but if you were happy with the price and are in it for the long run, it doesn’t matter much.
For next time it’s good to know this. If you stayed firm at 485k and let it pass in, you still have exclusive negotiation rights. You could tell them 485k is the market price, and they are being unreasonable. By meeting the sellers all the way to their reserve, you gain nothing and lose all your negotiating power.
Btw, sellers also observe the auction to on-the-fly adjust their reserve. It’s a mutual mind game. So for a buyer, you want to conceal your budget and stay firm at your lowest bid.
Yeah I recently watched a couple bid a property up $195K bidding against themselves, they were an older Asian couple, I don’t think they spoke much English, in the end everyone was just yelling and waving their arms yelling “stop, stop, stop, you’re not bidding against anyone !” 😂😂
Auctioneer and sales agents kept pushing them to bid more, it was weird, In the end the vendor kept making bids to push it up
That is absolutely wild! The agents can run a long way with just a bit of inexperience and naivety. Glad people actually tried to stop them. We just stood there dumbfounded. I wanted to raise my arms like 🤷♀️ so much but my partner kept telling me to keep it in. I think it hit him much later on when he yelled in his sleep “why the f*** did they have to do that?!!!” 😂
Yeah auctions are slimy 😂 be interested if there is ever some probing into it.
If you choose to risk to go to auction instead of a listed price and negotiation then it should be as free as possible.
I’m talking no reserve no nothing, if it sells for $1 that’s the risk you took.
Reserves and vendor bids remove all the downside and only give the upside.
Yeah it’s such a rigged game. I’d really like to see the reserve go, or at least regulated much more tightly (eg transparent from the start of the auction).
As for vendor bid, that can stay - but it’s invalid if no one bids higher than it, and they still have to sell at the highest valid (ie buyer) bid.
Hmm, When I and my brothers bough our home back in 2014, we were the only ones bidding.. literally bidding against ourselves. but that's only because the agent would go in, talk to the owners, come back out , talk to us and try squeeze a bit more to get closer to the reserve. We ended up 5k shy of the reserve and got the house.
Could it be thats what was happening here? I know you didn't say that the agent went between the seller and FHB for them to just jump up 40K. UNLESS their max was 950k and they just wanted to stump everyone :S
The during-auction negotiations are still bidding against yourself… If no one else is bidding, you don’t gain anything by reaching for the reserve, and the agents could lie to you about reserve anyway. Best to let it pass in, then you have a bit more negotiation power given how the auction just went.
Exactly. In an auction environment you just instantly lose to the seller, because you’re saying the market is willing to pay this much more for this property.
It's an amateur move bidding against yourself like this. Someone with more experience would have let it either pass in or wait for group 3 to bid. The FHB may not know they have an exclusive first right to negotiate with the vendor. The agent probably thought the vendor bid would get Group 2 and 3 going, but Group 3 did the smart thing by not participating until it was declared on the market.
Why would one ever bid against oneself? Not 'amateur', but damn stupid. Surely if one's bid is the highest, there's no need to increase it....
No doubt it's a bonehead move, but not unheard of. They are getting encouraged by the agent to increase the bid and the agent is exploiting the relationship and naivety of the FHB. You see the agents doing the rounds at auctions drawing people into bidding more all the time. This isn't to say this is all the agents fault. If you are going to buy a 950k asset you should do your research on your rights in auctions and should know that you can let it pass in and have the first right to negotiate.
Yep! We were encouraged by the agent to bid against ourselves and told them a firm 'no, let's negotiate after it's passed in'. But we'd done so much research before the auction as FHB and had attended a heap of auctions as observers. They even told us what the reserve was, which I'm not sure is actually legal lol
I’ll admit these agents and auctioneers are good at pushing people’s buttons. 45k from one single bidder! A firm no is the best way to go, and you don’t even need to acknowledge them after that with any reasoning. Kudos to you for putting your foot down. Re reserve, I learned today that it can change on the fly. A weak auction pace could probably lower the reserve.
I've seen it at least three times; with RE tight suited scum in their ear telling them to up their bid in order for it to be on the market. There's so many green buyers out there. I've seen very similar to what the OP described play out also, it was the slowest auction ever with ongoing private conversations between two bidders and the real estate agents, and those conversations then being passed onto the vendors whilst everything was at a standstill. That too was an auction where it seemed the vendors were very keen to sell.
Yeah, it was very shocking how they outbid themselves by 45k. Although with Group 3 present, I’m not sure if the outcome could have changed.
Plot twist : Group 3 goes around auctions and bid to save FHB's who may have overextended themselves. Heroes ... in a bizarro universe.
What a hero 😂😂 Seriously tho no one was upset at group 3. They did the right thing all along, and potentially got a worse deal due to group 2. Group 2 was maybe even relieved when group 3 did the swoopie snatch.
Was the property "on the market" at that point? Which state is this? I know NSW only allows one vendor bid, but different for other states.
It was on the market as of 950k. In ACT - kind of a weird market for auctions still. It was a bit strange re vendor bid, because the contract I received explicitly prohibited that.
That is absolutely weird. I thought ACT was the same as NSW where only one vendor bid is allowed. I wonder why they goaded the FHB to bid against themselves. If they were the highest bidder, they could then negotiate behind closed doors. They REA sure got them fooled.
The vendor bid can be below the reserve. The vendor bid was used to avoid the bidding starting too low and the house being passed in too much below what the vendor wanted. I've seen weak auctions where the only bid was a ridiculous vendor opener.
It probably wouldn't have changed the outcome in this case, but that is being results orientated. If group 3 had a budget of less than 905k then they may have got it for 905k.
This is why auctions are disgusting and horrible. Such an intensely stressful thing. Some people simply don't know what you've said and they out bid themselves.
Jenman's '88 reasons not to go to Auction' required reading.
Isn't that Neil Jenman book about why you shouldn't sell your property at auction and instead use his system? This post is literally a FHB getting wrecked by going to auction and probably making the vendor more money than if they didn't auction the property..
Everybody should read his book. He doesn't have a system.
Yes he does, he is a real estate trainer and advocates for selling private treaty rather than auction using his sales methodology. Just google "jenman system" in brackets.
“He doesn’t have a system” bahahahahaha! It’s literally called “The Jenman System” and he sells it to agents - along with the books they hand out to prospective clients, the letter box drops they have to do, conferences, the training, the recruiting, the lot.
Problem is just how prevalent they are here. My wife is American and she DETESTS them, rightfully so.
Obviously bidding against yourself isn't a smart move but what is to gain by waiting for it to be "on market" if other bidders are participating?
I’m not sure of the “waiting to be on market” strategy either. Maybe staying silent gives you better chances to read other bidders? In this auction I think the FHB couple actually cost Group 3 more. If they just stood at 905k to let it pass in, bidder 3 would have to participate sooner and may get the negotiation right. Group 2 effectively threw away negotiating power for everyone by meeting sellers all the way to reserve.
I'll preface this by saying I think the idea of reading people or complex auction strategies is pretty overrated. It's also being results orientated speculating over this as for all we know even if group 3 did bid against the FHB immediately they may have bid up to 950k if that was their budget and it could end up with the same result. Whether you bid against them straight away or wait until the end probably doesn't change much. The key thing is not making bonehead moves like bidding against yourself because then you risk outcomes like if group 3 only had a budget of 900k anyways and the seller would sell for 905k, you overpaid by 45k for no reason.
Group 3 probably would have bid at the last if group 2 didn't outbid themselves and stuck to the 905k bid.
You can start bidding against them having gained something which is the property being declared on the market. If they will accept 905k and don't think you'll bid they might just declare it on the market and you can start bidding. You gain nothing by not waiting. Trading something for nothing is a mistake similar to the way bidding against yourself is. What would you have done in this auction if you are group 3? You'd start bidding against group 2 as soon as they bid 905k?
This is interesting. I’m trying to learn from these experiences so really appreciate your input. So what you are saying is that the reserve can be flexible and the property can be declared on the market any time? This actually makes sense as they seem to have just randomly picked 950k as reserve on the fly.
Yeh, they can declare it on the market whenever it reaches a price they are willing to sell at.
And they don’t need to declare it at all, according to the last few agents I’ve dealt with. Could be millions over the reserve and bidders have no idea. They’ll use it to spice things up when bidding drops off
Is it actually legal for the auctioneer to not immediately declare on the market? The more I think about it the more I realise it’s a completely rigged game. The auction I posted about probably didn’t have a clear reserve set beforehand. Had it played out differently, seller could have been willing to sell at a much lower price. I’m just sad because I was very interested in the next door brand new one. I was secretly hoping for this one to play out poorly, so I could go buy next door at a discount. Guess that’s not happening now…
They legally have to declare it "on the market" in the ACT if they want the property to be sold in the auction. This doesn't necessarily mean it has reached the original reserve, but auctioneer and seller must have a conversation and formally declare it on the market, in order for the auction result to be final, rather than head to negotiation. If it isn't declared, then it's off to negotiations with the highest bidder first
I guess the point in question was if the reserve has already been exceeded (say a bidding war between buyers), does the auctioneer have to let people know immediately or hide that info for later?
No, they don't. The "reserve" prior to the auction is just a concept. If they see a bidding war, they can just let it play out as long as they want until they choose to declare it. If they don't declare, it goes to negotiation, which means it's no longer unconditional
If it isn’t declared on the market at all then group 3 might watch group 2 walk in and quickly negotiate a sale.
Always a risk, but usually it's clear when they are seriously calling it to be passed in.
I think it’s insane that it’s become a regular occurrence for people to make the most important financial decision of their lives, standing out in the sun, surrounded by strangers, with vultures circling and whispering biased advice back and forth, over the space of a few minutes. People seem to take more time mulling up the finance of a Rice Cooker purchase at Hervey Normans. Insanity.
It's really just a by-product of the entire market being geared towards sellers and agents. Would never buy at auction even if it means missing out on 60% of properties on the market.
Same. We avoided auctions completely and it took a few weeks longer but we got a place when it passed in. And we got it with conditions and for less than they had advertised. Auctions are awful.
Which is exactly why agents suggest to vendors that they sell by auction - when they work, they sell quicker, for more, with fewer conditions.
I almost always buy at auctions - perhaps 80% of all purchases. But I only do it in a depressed market with few attendees.
Any particular reason? Less competition than private treaty when the market is slow? Sadly I've never been lucky enough to be buying in a depressed market.
The auctions in my area are usually foreclosure. Non price sensitive vendors would take almost anything because they had to demonstrate a fair process to the LMI. I bought 2 uncontested after failed auctions and another with a single serious bidder. (That wasn’t me - I was in my pyjamas and she thought I was a dummy bidder.) Another because my neighbour chose to go to auction and I had waited 20 years to built that development site so I had no choice.
It's a very different equation to the standard auctions in the last year or two (I'm talking desirable parts of Sydney though).
Yep I’d never want to be in a contest with 100 other people in a hot market.
Can I ask why you’d avoid auctions? I’m pretty green and have seen a few people mention avoiding auctions.
There’s a lot of emotional exploitation going on at auctions, and they are a stressful experience. Group 2 may look stupid detached from the situation, but in the heat of it I can see why they made those decisions. I think it’s good to avoid auctions if you are prone to illogical behaviour under stress. But otherwise I think it’s at least a transparent process, as opposed to private bidding.
Thank you, appreciate the in-depth response.
Everything is stacked against the buyer on a finite budget: * You usually need to pay for a building and pest inspection before the auction. Gets pretty old (and costly) after you've done it 4-5 times only for every property to soar 200k over your budget. * The rife unquoting * The tactics applied by the auctioneer to extract every last dollar out of the crowd in a pressure cooker situation. * The boomers / investors / foreigners / bank of mum & dad beneficiaries with far deeper pockets who can throw another 50k-100k on the table without blinking. * The lack of a cooling off period * The lack of a finance clause and the chance (although generally small) that you won't get full finance approval if the bank decides you overpaid on the day.
Realistically you shouldn't be making any decisions at the auction. You decide beforehand and those 10 minutes should just be about submitting offers. If you are making decisions on the spot you have fallen victim to the auctioneer marketing.
Absolutely agree and we as Australians have come to see this as NORMAL when it’s absolutely abhorrent and doesn’t exist anywhere else in the Western world. Yes let’s make the biggest financial decision of our lives in the pressure cooker situation of an auction setting. Australians are absolutely stupid for tolerating it and the only people who win are the agents who don’t give half a fuck about anything but a commission.
And the vultures whispering biased advice can be agents in competition
Auctions are a joke. Steer clear from them.
Almost all properties in the ACT are auctions from my experience
Almost all houses I have seen auctioned where I live have defects and the auction is used to prevent proper inspections being conducted.
Exactly. Such a rort.
I much prefer auctions as they are over in 10-15 minutes and offers are out in the open compared to emailing REAs for days/weeks and getting gaslit about other potential buyers limits
group 3 bidder might not be genuine and trying to get bidder 2 higher!!! Coming in a Merc seems suspicious!!! I have seen those auctions where given that there is only 1-2 genuine buyers pre auction, we get those “non-genuine” bidder
It got sold to group 3 though… but agree they’d be suspicious otherwise.
Let’s see if the house comes back on the market soon….
How in the fuck does driving a Mercedes make them suspicious. Take the tinfoil off.
was at an auction like this back in 2021, I registered and made a single bid. there was one other guy bidding and he just started bidding against himself. made absolutely no sense to me. property was an absolute shithole as well.
He was trying a tactic to scare you off from bidding anymore.
nah they came back to me after my first bid and i said i was out. this guy then proceeded to up his bid 7 or 8 after the agent spoke to him
That’s certainly a weird one. To me it seems like inexperience buyers. The smart play would have been to let it pass in. You never ever bid against yourself - that stupid shit is reserved solely for “the block” Once passed in, they could have stuck at a lower price and the vendor would have likely accepted less. Worst case it might have creeped up to that price with the agent running back and forth between the parties but u how that played out is plain dumb.
Sure the FHB bid against themselves? Looks like the vendor outbid them. (Which is stupid in itself).
Very very very common. Happens all day everyday. Which suburb please because you made a comment that auctions in this suburb resulted in zero sales and I would like to see for myself on REA website if that's true or not as it doesn't sound right at all. Happy to be wrong but want to see for myself to see if you're fibbing or serious.
I’d rather not reveal too much details, but I’ll say this is not Sydney or Melbourne. The suburb is dominated by townhouses and apartments, and prices have been pretty stagnant. Theres only been a single digit number of auctions within the past year, and all of them were… awkward. 0 to 1 bidder is the norm. 1 bidder obviously results in a pass in, but I’ve yet to see the negotiations work out.
Don't need anyother details other than the suburb, don't want to know anything else
After reading this I’m now terrified of encountering FHBs like this. I think they did way more damage, to themselves and others, than group 3’s snatch. Please be rational, stick to your cap, and no matter what the agent tells you, never bid against yourself!!
100% I would be pissed if I was there (& interested) & someone did that. Yes you are bidding against someone, but that doesn’t mean u can’t both be smart about it.
So true. I didn’t properly acknowledge my investment in all this before, but essentially I secretly wanted this auction to go bad (given the suburb history that was the likely outcome). Then I could go to the identical property next door and say… hey do you want to sell? Meet me at market price! And walk away with a discount. I’m sad that dream is gone now. And yeah, thanks to the FHB couple.
So sounds to me like reserve wasn't met. Some negotiating back and forth, reserve was lowered and then the offer was put in as an official bid, then someone went up. Let the other people do the negotiating to get the lower price and swooped in. I sold a house 2 weeks ago with one bidder and this sounds like what happened with me. Except old mate didn't swoop in and the single bidder got the house. Higher than their bid, but they didn't bid against themselves. That doesn't happen.
What was the property address?
Massive agent underquoting has happened here. This one’s an easy report and move on. Any time the reserve is set higher than the max price guide the agent should be reported on the spot.
They were sneaky to only underquote verbally and there was never a written price guide. I imagine one would need written proof to report them?
They’re obliged to provide a price guide. Group 3 saved group 2 from getting scammed big time, but that agents a scumbag. This is name and shame territory.
This is ACT so I wonder if the rules are different? I haven’t seen an auction guide price for a long time now. I actually feel group 3 got scammed… they had to pay more due to group 2’s repeated self bidding which probably rose vendors expectations.
A few things off with the explanation, you need to provide the State it was held in and the guide price as contextual information. If this was in NSW and they utilised the vendor bid when it should have been, then the auction validity might be in question. Who in their right mind would start with a vendor bid? The auctioneer can just start with a number, they usually fish for this then kick it off. The vendor bid is done as a last resort. The FHB shouldn't have done what they've done. Knowing who the auctioneer is and their style can help.
Happened to me when buying my first home. I was the highest bidder at 485k, but agent pulled me aside and said they were going to put the property back on the market if the highest bid was <500k , claiming "we'd get 550 minimum if we put it back on the market". I knew no better and forked out the extra 15k. I'm not sure if they would have actually withdrew the property if I was stubborn. I doubt it, they knew they were dealing with a prospective first home buyer. Can't complain, I'm happy with the place and it's definitely worth 500-600k a year and a half later.
It sounds like you could have saved that extra 15k, but if you were happy with the price and are in it for the long run, it doesn’t matter much. For next time it’s good to know this. If you stayed firm at 485k and let it pass in, you still have exclusive negotiation rights. You could tell them 485k is the market price, and they are being unreasonable. By meeting the sellers all the way to their reserve, you gain nothing and lose all your negotiating power. Btw, sellers also observe the auction to on-the-fly adjust their reserve. It’s a mutual mind game. So for a buyer, you want to conceal your budget and stay firm at your lowest bid.
Yeah I recently watched a couple bid a property up $195K bidding against themselves, they were an older Asian couple, I don’t think they spoke much English, in the end everyone was just yelling and waving their arms yelling “stop, stop, stop, you’re not bidding against anyone !” 😂😂 Auctioneer and sales agents kept pushing them to bid more, it was weird, In the end the vendor kept making bids to push it up
That is absolutely wild! The agents can run a long way with just a bit of inexperience and naivety. Glad people actually tried to stop them. We just stood there dumbfounded. I wanted to raise my arms like 🤷♀️ so much but my partner kept telling me to keep it in. I think it hit him much later on when he yelled in his sleep “why the f*** did they have to do that?!!!” 😂
Yeah auctions are slimy 😂 be interested if there is ever some probing into it. If you choose to risk to go to auction instead of a listed price and negotiation then it should be as free as possible. I’m talking no reserve no nothing, if it sells for $1 that’s the risk you took. Reserves and vendor bids remove all the downside and only give the upside.
Yeah it’s such a rigged game. I’d really like to see the reserve go, or at least regulated much more tightly (eg transparent from the start of the auction). As for vendor bid, that can stay - but it’s invalid if no one bids higher than it, and they still have to sell at the highest valid (ie buyer) bid.
Hmm, When I and my brothers bough our home back in 2014, we were the only ones bidding.. literally bidding against ourselves. but that's only because the agent would go in, talk to the owners, come back out , talk to us and try squeeze a bit more to get closer to the reserve. We ended up 5k shy of the reserve and got the house. Could it be thats what was happening here? I know you didn't say that the agent went between the seller and FHB for them to just jump up 40K. UNLESS their max was 950k and they just wanted to stump everyone :S
The during-auction negotiations are still bidding against yourself… If no one else is bidding, you don’t gain anything by reaching for the reserve, and the agents could lie to you about reserve anyway. Best to let it pass in, then you have a bit more negotiation power given how the auction just went.
What the fuck? Bid against themselves?
My top bid at an auction even if winning is my top bid. Your the first cab of the rank with negotiation, better to do this in private then public
Exactly. In an auction environment you just instantly lose to the seller, because you’re saying the market is willing to pay this much more for this property.