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Hammer it home!

by Sinead Hogan  Updated: Wednesday, 29th June, 2011 5:30pm

Almost four deflated years have passed since CNN columist Gerri Willis commented that "as more and more people get frustrated with the sluggish housing market, people who want to sell their homes are looking at a different tactic...auctioning off their home".

It could be a trend that has made its way across the Atlantic, going on the experience of auctioneer and estate agent in this area, Padraig Smith.

Mr. Smith says there has been a definite increase in the number of properties he is auctioning, and he tells The Anglo-Celt that he is having a success rate of about 70%.Selling by auction rather than private treaty can expedite the sale because it puts a deadline on it as well as bring the valuation process down to brass tacks.

The value of anything is all about supply and demand, as any economist knows.

"At an auction you get a true reflection of what the property is really worth according to those who are actually interested in buying it - the bidders in the room," says Mr. Smith. "It's not a case of someone else putting a price on it, the market decides."

Prices, of course, are far from guaranteed. As the CNN columist put it in her article of September 27, 2007 (advising against auction if you are set on a fixed selling price): "an auction will give you the market value of the home as it is on the day of auction and that could be five percent or ten percent or 20 percent less than what you require".

Auctions are associated with one-off properties and there's a perception that this type of sale is for the higher end of the market. Mr. Smith, however, says that properties of any value can be auctioned.

He advises sellers, regardless of how they are selling, that the price is the key variable in ensuring a successful outcome.

"The most important thing I try to tell people trying to sell a property is to put a true realistic value on it. If you put a realistic reserve on it you usually get over the line," he says, pointing out that banks will only give credit if the value is realistic.

Mr. Smith also recommends giving plenty of notice. Gone are the days when people put down deposits feeling confident that the loan offer would be forthcoming. Prospective buyers need plenty of time to get through paperwork and organise loans. He gives about six weeks' notice for auctions.