What do we know about online real estate auctions?
When it comes to an online auction platform, consumers generally think of an eBay or Bid-or-Buy style auctions or ‘timed’ auctions, which in essence is a website based mechanism allowing buyers to place a bid on a product. Similarly property auctions work within the same framework and also with pre-set opening and closing times.
The highest bid stands but can be replaced by a higher bid of another bidder until the stipulated time frame lapses with the highest bid at that point winning the bid. This entire process is automated without any interaction of an auctioneer. “Therefore it may not be seen as a real auction but rather an automated process that encourages buyers to make an offer” continues Stenzhorn.
Why use real time online auctions?
The business model of In2assets, the national operating property specialists, has been through conventional real estate auctions conducted onsite or at a venue offering combined property auctions.
“To execute an auction successfully a number of properties (predominantly commercial) must be sourced and offered on the auction platform creating the combined property auction experience; offering a range of properties in different lots at the same auction event” explains Stenzhorn further.
The focus of real estate auction houses lies mostly in metropolitan areas, where stock is more easily available. This is unfortunately a disadvantage for property owners in remote areas or smaller towns who would prefer to participate in real estate auctions as their buyers’ market could be local or international.
“With the new In2assets real time online auction platform, we can reach buyers in every town of South Africa and beyond” expresses Stenzhorn.
How does the In2assets real time auction work?
A transactional platform ClickToPurchase®, originally launched in the UK, for buying and selling property online is operated under sole license to In2assets. Uniquely it provides in the UK the facility for a legally binding exchange of contracts to take place electronically. This platform provides the technology to conduct online, real time auctions – accurately simulating a live "ballroom" auction with an auctioneer not a computer conducting the auction. In other words, the auctioneer interacts with every bidder directly as one experiences at a physical auction, however the communication takes place online and bids can be placed in split seconds. Equally significant is that auction lots are sold in minutes, not hours or days like other auction websites, which is important.
The great advantage being buyers can participate at the auction in real time, at their own convenience. We believe that this will attract a wider spectrum of buyers and a greater willingness to participate in real estate auctions. Online property auctions are more cost effective than conventional venue/onsite auctions.