Posted to The Age (28/9/2011) on 28/9/2011 at 5:20 PM
Commenting on “Underquoting will never stop”
http://theage.domain.com.au/real-estate-news/blogs/domain-investor-centre-blog/underquoting-will-never-stop-20110928-1kwrm.html
Rules are rules, and we must adhere to them whether we like them or not. However, we must instigate to change the rules, especially these stupid ones. As a licensed estate agent, I believe that the term underquoting should be removed from the real estate vocabulary. Like most retail products or even professional services, having recommended prices or schedule fees respectively, all properties listed for auction should have a recommended price, list price or reserve, whichever one the public likes to call it. The so called reserve price is in fact a recommended price or schedule fee guide, and should be disclosed at the start of the auction. Bidders are allowed to bid below this reserve – it is no different from asking for a discount from the seller. The seller can ignore the bid, and the show can continue to go on. Auction is a classic supply and demand model taught in a marketing textbook. If there is more demand than supply, namely many bidders with one ideal home worth dying for, then the highest bid wins the day. By the way, according to contract law, suggested list price of a product is not set in concrete, and can be negotiated. So how do agents get their commission for an auction property? Negotiate with the seller when they get the listing, how else?
Commenting on “Underquoting will never stop”
http://theage.domain.com.au/real-estate-news/blogs/domain-investor-centre-blog/underquoting-will-never-stop-20110928-1kwrm.html
Rules are rules, and we must adhere to them whether we like them or not. However, we must instigate to change the rules, especially these stupid ones. As a licensed estate agent, I believe that the term underquoting should be removed from the real estate vocabulary. Like most retail products or even professional services, having recommended prices or schedule fees respectively, all properties listed for auction should have a recommended price, list price or reserve, whichever one the public likes to call it. The so called reserve price is in fact a recommended price or schedule fee guide, and should be disclosed at the start of the auction. Bidders are allowed to bid below this reserve – it is no different from asking for a discount from the seller. The seller can ignore the bid, and the show can continue to go on. Auction is a classic supply and demand model taught in a marketing textbook. If there is more demand than supply, namely many bidders with one ideal home worth dying for, then the highest bid wins the day. By the way, according to contract law, suggested list price of a product is not set in concrete, and can be negotiated. So how do agents get their commission for an auction property? Negotiate with the seller when they get the listing, how else?
