As auction clearance rates sit at an all-time low there is only one questions on vendors’ minds: “Is it still worth taking a property to auction?”

According to Kollosche sales agent and licensed auctioneer Paul Harrison is an emphatic yes, and the reason as little to do with what happens on auction day itself.

Clearance rates on the Gold Coast, and nationally, have dropped sharply over the past year. Realestate.com.au has recently recorded the city’s figures at between 20 and 30 per cent, well down from the 70 to 80 per cent-plus results seen during the market’s most recent peak.

Yet Mr Harrison said that headline number tells only part of the story. It doesn’t capture what happens in the week either side of auction day.

“Based on my years of experience running these campaigns, I can say with confidence that as many as 70 per cent of properties taken to auction sell either shortly before or shortly after auction day and once bidding has established where the market genuinely sits,”  he said.

Even when a property draws no registered bidders on the day, Mr Harrison maintained that the process remained highly important to the sales process.

“What it does do is generate real insight rather than leaving you operating on guesswork,” he said.

“It reveals the types of buyers circling a property, who they are, and what they’re actually prepared to pay for a property. For vendors, that intelligence is invaluable, particularly if a property needs to be repositioned for a post-auction sale.”

He is far more sceptical of the alternative: a private treaty or expression of interest (EOI) campaign. In a market where genuine value is uncertain, Mr Harrison said opting for either approach could work against vendors.

“Nobody is obliged to give feedback during an EOI campaign, there is no real urgency, and buyers tend to hold off until the last possible moment,” he said.

“A campaign can drag on for weeks and still leave vendors with nothing meaningful to go on.”

Time is the one thing vendors simply cannot afford to lose, according to Mr Harrison.

“The longer a property sits on the market, the more likely it is that the control will shift from the vendor to a buyer.”

He added that a listing that lingered on the market risked loss of interest, with buyers drawing their own conclusions as to why it may not have already sold.

By contrast, Mr Harrison said that the discipline of a four-week auction campaign, keeps the vendor in control of the outcome longer, with the chance to sell before, at, or shortly after auction all within the same window. No other process, he said, offered that same flexibility.

“Slow market or not, auctions will always remain the smartest pathway to achieving sales success.”

To learn more about the auction process and what happens during an auction campaign, reach out to Paul Harrison or any of our other agents today.