Online auctions may seem a scary departure from the traditional experience of watching your property being sold on the front lawn in front of a large crowd. But like many facets of our lives in a COVID-19 world, this change could be here to stay.
Why? Because it’s so simple.
Internet auctions have become common in the art world while homeowners and agents have preferred the more human touch to selling.
That’s understandable but with social distancing likely to be here to stay physical auctions will be complemented by the many digital alternatives that are available.
Who does the auction?
Your agent will know several companies that provide a platform for an online auction. These include Sold Online, Openn Negotiation, Auction Now and Gavl. On each of these platforms, an auctioneer is on video, conducting the sale of your property in the traditional way.
Bidding is different, though.
How does it work?
Prospective buyers will be invited to sign up to the platform. For those wishing to bid, each system will request credit card details and permission to put a hold on up to $2,500. This ensures all the bidders are genuine. Those wishing to watch the auction can sign up in the same way but don’t need to provide any financial details.
At the designated time, the auction will take place much like those held on the footpath, in a front garden, or at a third party venue. Some agents will also encourage telephone bidding.
Instead of waving a hand or nodding, bidders have a series of buttons they can click on to bid for the property, pushing the price higher. It’s conducted in real-time and buyers can make their bids on a computer, tablet or a smartphone.
All the legal obligations of the seller and successful bidder hold for an online auction, just as they do in the “real world”.
It’s sold, what next?
This depends on the capabilities of the platform being used. Some platforms offer an end-to-end transaction process, meaning any subsequent negotiation and contract exchange is conducted on the platform, and you’ll have full transparency to those activities.
Your agent may ask you to open an account with DocuSign, which is a platform that allows legally-binding documentation to be signed digitally, so you don’t have to turn up to an office to complete that task in person.
