Benefits of bidding at auction
If you thought auctions for inner-city terrace homes were action-packed, try attending an auction for a commercial property leased to Coles, 7-Eleven or Bunnings.
You’ll be stunned at just how hot the competition can be to secure these assets.
In fact, many buyers and investors much prefer to purchase at auction as opposed to through expressions of interest and other methods, and with good reason.
Here are five key benefits of bidding, buying and attending a Commercial property Auction.
Want to know exactly what (and who) you’re up against? An auction is far and away your best bet.
Participating in an auction affords you absolute transparency when it comes to price and the number of interested parties, as well their location.
Buying through expressions of interest or other non-transparent methods means you’ll never know if you overpaid by $100,000, as there’s no way of telling who the other buyers are and where they might be positioned on price.
There’s also confidence to be gained from seeing other bidders vying for your property. If someone else wants it, chances are you’re onto a good thing.
There’s no waiting around when it comes to auction results. It truly is a case of, ‘you bid for it, you bought it’.
Each bid is effectively an immediate unconditional offer to purchase that property, and provides other potential buyers with the chance to immediately better that offer – or not.
At auctions, if you’ve got the money and the winning bid, you effectively own the property at settlement and can move onto planning with certainty for future opportunities, rather than missing out on other properties because your money is tied up in a protracted negotiation.
Bid from anywhere
Can’t attend the auction in person, or is the property interstate? No problem.
It’s never been easier to bid at a commercial property auction remotely, with Burgess Rawson operating fully integrated systems in each of our state offices.
Prospective bidders can attend those offices and bid on properties in real time, or from anywhere in Australia or internationally. In fact, a large percentage of the properties sold through our iconic Portfolio Auctions are purchased by interstate bidders.
There’s no excuse not to get involved!
A market snapshot
There’s almost no better way to get an instant snapshot of the commercial property market and sentiment than to attend one of these auctions, held every six weeks.
At our Portfolio Auctions we put as many as 50 commercial properties under the hammer across a 48-hour period, capturing multiple asset classes.
This effectively provides a ‘live’ snapshot of the national market. Investors wanting to know which asset classes are in the greatest demand need look no further than the results from each auction, with multiple classes auctioned side by side within minutes of each other.
The clearance rates from our auctions can also be a good indicator of overall market sentiment and the general appetite for commercial property throughout the year.
Testing the value
It’s the big question constantly facing commercial property owners: what is my property worth?
While there’s no hard and fast formula for calculating a property’s current value, you can get a very good indication of where it might be positioned by attending an auction and using similar properties as a barometer for yours.
You’ll very quickly be able to define what your likely buyer demand might be, how big the buyer pool is and whether there’s competition for similar assets. Even if you have no intention of selling, it will help you to determine if now is a good time to have your property revalued, if you’re hoping to leverage and expand your holdings.
Meanwhile, for budding commercial investors, attending an auction and speaking to agents about particular properties – or the market in general – is a great way to expand your knowledge and put you in a better position when it comes time to buy.
Written by Scott Meighan