If there’s three things Melbournites love of a Saturday, it’s coffee with the papers, watching their team win at the MCG, and the street-theatre of a cracking auction.
And it’s not just Melbournites that love the smell of an auction in the morning: the perennial popularity of ‘reality’ real estate TV such as The Block is testament to Australia’s fascination with property. Whilst The Block is a show more about winning cash than selling real estate, each season I watch The Block finale as I can’t help myself: I’m a Melbournite who loves an auction.
When I began in real estate as novice in my twenties, I aspired to one day have the knowledge and sheer chutzpah to be an auctioneer. Happily, I acquired that skill, and was one of very few female auctioneers in Melbourne at the time. It’s true that calling an auction is not for everyone: some agents don’t fancy being the focus of a crowd, others feel nervous about their capacity to count in varying increments under pressure. I remember my Principal explaining to me that whilst it appeared that anything could happen in an auction situation, the likelihood was that it wouldn’t. Being an auctioneer is tantamount to being the circus Ringleader – what occurs during the process of your call is mostly in your control. Although I’ve been privy to hundreds of auction calls, I’ve only seen a couple where the crowd have heckled or behaved appallingly. When unpleasant outbursts do occur, the wider crowd will often turn on the heckler – either by making dagger eyes and huffing in their general direction, or by literally telling them to pull their head in. I must admit, I always enjoy it when the ne’er-do-well heckler gets their comeuppance.
Being an auctioneer is a talent, a skill that not all possess. Auctioneers are the lead actor taking centre stage at the pointy end of our weekend property sport, admired, reviled and mythologised. Here’s the thing: auctioneers don’t have the supernatural money-making powers shows like The Block and many punters believe them to have. A fine auctioneer executes a wonderful piece of performance art paired with the gain of lucre in public: it’s compelling and exciting to witness a great auction that flies past reserve in the blink of an eye. But in real terms, the true influence an auctioneer has over a property’s sale result is low to moderate at best. Here’s why:
Auctioneers are only as good as the sales campaign behind them.
An auctioneer cannot make an over-priced property in an over-supplied market sell, no matter how great their patter or how capable their count. In order for an auction to succeed the listing agent (this is the person with their name on the ‘For Sale’ board) must have run a good campaign. This means they’ve collaborated with their motivated vendor to appropriately price the property, attracting interest from the market – and hopefully, hordes of potentially-willing purchasers on auction day. If the property is overpriced, no amount of mad auctioneering skillz will save the campaign. The groundwork critical to a superb auction result is undertaken by the listing agent – and finished off with razzle-dazzle and control by the auctioneer. Ultimately, selling real estate is all about pricing competitively; the adage of ‘price it low, watch it go’ will always be true (regardless of trends in quoting). If a property is overpriced and there’s no willing bidder in the crowd, the best an auctioneer can do is emergency triage and entertainment before passing that sucker in and privately negotiating ASAP.
A house made entirely of KFC buckets mortared with ‘mashies’ will successfully sell at auction if it’s priced competitively enough: the auctioneer will simply season the deal with their charming seven secret herbs and spices (none of which involve pricing the property or educating the vendor about market realities, all of which is done by the listing agent).
Auctioneers are enabled or stymied by vendor reserves.
On The Block, contestants are delivered reserves stipulated by the true vendor (that being Channel 9). The narrative of The Block positions the contestants as the vendors, though in reality they’re not: they have no control over the reserve set by the station.
In the real world – should an auction be struggling – the agent can take instructions from their vendor mid-call. Depending on market conditions, the vendor may choose to put the property ‘on the market’ and amend their reserve to the last bid – or they might maintain their reserve, opting to pass the property in and negotiate with the highest bidder. The vendor’s instructions directly inform the auctioneer’s ability to successfully sell their property under the hammer. Again, much of the groundwork assisting to make the vendor aware of market feedback on their property is completed by the listing agent – who can hopefully encourage the vendor to set a reserve that’s realistic.
Auctioneers can’t make people buy houses.
When Shelley Craft looks to camera on The Block, remarking that ‘the auctioneer really has to go out there and make us that money’, I feel slightly nauseated. The auctioneer is not the person a successful sale hinges upon: the listing agent and the vendor themselves are. It’s misinforming the public to simplify the matter and pretend that the auctioneer can pull money from clench-fisted buyers who don’t see value in a property. If a property passes in, it’s not because the auctioneer is crap. It’s because the vendor hasn’t met the market (whether they’ve chosen to reject their agent’s advice on reserve, or the agent hasn’t attempted to condition them is the unknown factor).
It’s absolutely true that a talented auctioneer has some influence over an outcome at auction. They serve to entertain and inform the crowd, warming them up and encouraging those interested in bidding to raise their hands. Auctioneers are a walking advertisement for the prestige of the agency they represent, and should be sharply-presented with a dynamic calling style. They are responsible for making the crowd feel safe, and as though all is under control – if you’ve been to an auction where the auctioneer is fearful, the tension and dread is palpable and can serve to scare the crowd to stillness. Auctioneers are a very important part of the real estate sales process in Australia: they’re the Baz Luhrmann sparkle on the everyday gruntwork of a month of open for inspections. Their job is awe-inspiring to many, and the best of them are raconteurs who make our Saturdays sparkle with filthy lucre and witticisms – particularly when bidding is fast and furious. All I’m suggesting is: the auctioneer doesn’t have market power in the palm of their hand. Ultimately, it’s the vendor – and the talent of their listing agent – that decides whether an auction campaign flies or fizzes.
Iolanthe Gabrie a senior property writer, and the Director of Melbourne’s social media agency, Ruby Slipper.
Photographs by Kyle Larson.