A $100 million dollar fine. You read that right, a ONE HUNDRED MILLION DOLLAR FINE is what a real estate agency is facing in Melbourne for underquoting at auctions. Surely there is an easier way. The Queensland way! Plenty of southern real estate ‘experts’ have travelled north of the border to try and tell us that ‘price guides’ are almost essential when it comes to auctions. But when you look at the trouble they are in down there currently, you would think maybe they would look up north for their solution.
Having no price guide does make it harder to gauge if you can afford a property and whether you should investigate it, but what’s worse is being told you can afford it only to later find out you were never in with a chance. When you break it down, there is almost no way to win when you give a price guide. Go to low and you mislead buyers, go to high and no one engages with the property. Trying for a ‘Goldilocks’ solution, the ‘just right’ price, is almost impossible at the start of an auction campaign.
The answer lies in educating buyers. Buyers should be informed when spending this much money on a property anyway. They should make their own minds up. They should accept the reality that maybe an owner wants more or less than they will pay and that its more about what they think it’s worth. Some tips to establish price are:
– watch the sold section on realestate.com.au. It is the most up to date property dash board in the market.
– attend open homes and auctions, gauge the interest and write down the sale prices.
– get a relationship with a loan broker. They are seeing sales every day and they can assist with an independent view on prices, while also considering your affordability.
When you consider that a small business will obviously never survive a $100 million fine, then maybe our bigger siblings down south should consider another way.
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