Advice and Opinion

Arrival of estate agencies into the auction field

The general public do not as yet appreciate just what a significant difference has been made by the few estate agencies who have moved into the auction field, says Tony Clarke, Managing Director of the Rawson Property Group.

The South African auction world, said Clarke, picked up a ‘regrettable’ image in 2011 as a result of bogus cover bids and too close, often corruption relationships between liquidators, attorneys and others handling distressed sales. Since then, he said, the auctioneers’ governing body has done a great deal to put matters right and the disciplines now under which auctioneers operate are stricter and well applied. In addition, the arrival on the scene of estate agency auction companies has also definitely helped to improve the sector’s image.

The traditional forms of auction, said Clarke, i.e. those run by an independent auction house, have tended to concentrate on deceased estates, commercial and repossessed properties and the perception that the ordinary seller had, therefore, was that they had very little to offer him.

With the arrival of divisions like Rawson Auctions in the auctioneering industry, all this has changed, said Clarke. The home seller can now first put his home up for sale by conventional means, but if these do not bring about the desired results they can then put the property up for auction. This has the additional advantage that auctioneering is a once-off exercise and does not involve the continual visiting from potential clients in conventional selling. Furthermore, if, like the Rawson Property Group, the group has a bond origination division, it can offer the successful bidder at the auction assistance in raising finance.

The incursion of estate agencies into the auction field, said Clarke, has also greatly widened the net of those attending auctions. More members of the general public, but particularly potential investors, are now regularly attending auctions and a fair amount of interest is now being shown by overseas buyers, generally working through a local proxy.

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