Adelaide: The city of bidders

Week after week, Adelaide most frequently boasts the highest registered bidder numbers across Australia, by a country mile. Only a few weeks ago, a house in Paralowie attracted a huge 58 registered bidders.

The financial year has been incredible for auctions in South Australia. In fact, it has been almost as successful as FY22, which we thought would be hard to top. We will end the financial year having scheduled more than 2800 auctions.

So what makes Adelaide, and South Australia as a whole, such a hotspot for auction activity?

Why are there so many bidders?

Simply, there are more buyers than there are houses for sale. However, I believe that in many cases it is the agent's ability to encourage the bidders along to their auctions. Buyers are still wary of the method, but only because they don’t necessarily understand it. The agents who truly believe in the method are able to make the buyers understand that it is an open, transparent way of buying property rather than a secretive private treaty method in which we are not allowed to divulge to buyers what other buyer’s offers are.

There is some reluctance and fear about the auction method, from buyers, sellers and some agents. Ray White schedules between 40-50 per cent of all auctions, however fewer than 25 per cent of all listings in the state utilise the auction method. This has grown from around 5 per cent pre-pandemic so the reluctance is lifting.

What is the advantage of the auction method?

The days on market are shorter for properties that go to auction. With the market as strong as it currently is, this is only by 10-15 days, but it means that a seller is ready to move on and they can buy their dream property much quicker. ‘Days on market’ has been stretching out over the last 18 months or so and I believe this will continue to be the way for the foreseeable future. When I first became an auctioneer (in 2012), 'days on market' was 120+ for private treaty and 60 for auction. Our clearance rate on auction day was less than 50 per cent however they sold much more quickly afterward. Auction is about the process rather than the auction day outcome

What type of stock performs best?

It may sound like a biased opinion but there is no property or suburb that is not suitable for auction. I have sold multi-million dollar mansions, one-bedroom units and everything in between. I have sold in the city, north, south, east and west, and countless auctions in Port Lincoln, Mt Gambier and many other ‘non-auction’ suburbs, all with great success.

Is there an auction day or time that performs best?

Up until two years ago I would never have conducted a residential auction prior to a Thursday, unless it was an in-room or online auction. Nowadays I have on-site auctions at any time on any day. A monday auction is not the rare occurrence it once was, and I often have auctions seven days a week. Auction times are no longer a barrier either and we are finding great success at auctions at 9am or much later in the day. In fact, less than one per cent of 9am auctions do not attract any bidding, much stronger than the four per cent of non bidding that happens on auctions between 10am-2pm.