New tech can get property buyers better prices
Technologies offered to make transacting property still possible during social distancing restrictions have given home seekers some unexpected advantages when chasing a good price.
Virtual property tours and online bidding platforms have become the norm in real estate sales during the coronavirus outbreak and industry observers claim they offer unique opportunities.
The technologies have become necessary following recent bans on open for inspections and on-site auctions announced as part of government measures to contain the spread of the pandemic.
Online auctions have become particularly commonplace - more than 150 Sydney properties went under the hammer via an online auction last week, with about 200 conducted the week prior.
Cooley Auctions director Damien Cooley, the co-founder of online bidding platform AuctionNow, said virtual auctions had unique traits buyers could exploit.
Most traditional auctions relied on some form of social pressure to get buyers to increase their bids, he said. This was often why agents invested in coffee trucks and other gimmicks to increase the crowds attending their auctions. Online bidders did not face this pressure and could instead use the more anonymous nature of virtual bidding against the auctioneer, Mr Cooley said.
"Silence used to be a good tool to use as an auctioneer. It's a great way to get someone to bid," he said.
"Silence isn't so good in an online setting. It's awkward. You don't get the same social pressure you'd get from seeing 30 or 40 people watching each bid, so it is harder for the auctioneer to get the bid they want."
Auctioneers also relied on body language to get a good sense of how close buyers were to reaching their limit, but couldn't do this when bidders remained hidden behind a computer screen.
"Auctioneers are more inclined to accept lower bids earlier so the general pace of (virtual) auctions is slower," Mr Cooley said.
Anyone registering at an auction and willing to buy was at an immediate advantage given uncertainty from coronavirus has thinned buyer competition, Mr Cooley added. "Owners are looking more favourably on bidders at the moment. Buyers who are prepared to bid up and bid early can control the auction," he said.
McGrath agent Betty Ockerlander, who has hosted multiple online auctions, said registered buyers appeared to be holding back, but those who submitted the opening bids were put in a commanding position.
In the off-the-plan market, virtual property tours have already made an impact on sales and could be a lasting alternative to traditional display suites which require home seekers to be on site.
Developer Multipart Property last week did a virtual launch of its $120 million Bowline luxury waterside development, with 27 buyers requesting virtual tours. Potential buyers were given access to a 3D model which allowed them to make changes to finishes, such as the colour scheme.
Seven apartments in the Newcastle development sold after the virtual tours, including a $1.5 million three-bedroom penthouse.
Selling agent Ryan Houston of PRD New Projects said it was "the ultimate transparency".
"We can walk a buyer through the floorplan and look at exact views from each apartment. It removes all the guesswork and provides certainty," he said. "It has been a hit for buyers … they can access their apartment floorplan whenever they like (and) double-check details."
Sales were conducted via the Immex platform and founder James Byrne said the applications extended to exchanging legal contracts and making deposits.
Originally published as New tech can get buyers better prices