Barfoot Auctions

[Tucker]

Has anyone been to any Barfoot Auctions for south Auckland Properties. If so how have the auctions gone.

[Davo36]

Went to a mortgagee one this morning. From memory:

1. 6/25 Solveig Pl, Manurewa. Little tiny fibrelite box. Sold for $125,000.
2. 359 Kimptons Rd, Brookby. A decent house on 8.95Ha, sea views. Passed in at $675,000.

I was interested in a property in Titirangi. I valued it at $250,000 to $300,000. The bidding STARTED at $300,000 and stopped at $360,000. I think everyone except one guy had valued it at $350k or less. What happened next was quite incredible. The agents kind of go over to him and ask him if he'll raise his bid. So he did, to $400,000! Why anyone would do this is beyond my comprehension.

But that's not all, he then raised his offer (no one else was bidding) to $425k, then $430k and then $431k. The property was then passed in! Prior to auction is was on the market at $450k - so only slightly higher and was sold in 2003 for $440k.

The property is in very poor shape and needs a lot of work. Leaks in the ceiling and many other things. And this dork bid against himself up to $431k. I dunno, I can't help but shake my head.

David

[67910241]

I was interested in a property in Titirangi. I valued it at $250,000 to $300,000. The bidding STARTED at $300,000 and stopped at $360,000. I think everyone except one guy had valued it at $350k or less. What happened next was quite incredible. The agents kind of go over to him and ask him if he'll raise his bid. So he did, to $400,000! Why anyone would do this is beyond my comprehension.

But that's not all, he then raised his offer (no one else was bidding) to $425k, then $430k and then $431k. The property was then passed in! Prior to auction is was on the market at $450k - so only slightly higher and was sold in 2003 for $440k.

The property is in very poor shape and needs a lot of work. Leaks in the ceiling and many other things. And this dork bid against himself up to $431k. I dunno, I can't help but shake my head.

David

A good mate of the vendor perhaps?

[Davo36]

I didn't think of that, but that makes sense. Or perhaps the vendors themselves!

David

[robbyp.]

I didn't think of that, but that makes sense. Or perhaps the vendors themselves!

David

It sounds very suspicious, and I doubt it was a real bidder at all. I think vendor bids and shrill bidding should be made illegal, as it misrepresents the market for the house.

[Heg]

B and T don't allow vendor bidding. I go to their auctions on the North shore nearly every week and have never seen any suspicious bidding.
However, the scenario as described above is VERY common. Auctioneers are trying to get the buyer up to the level at which the property can be bought. Nothing dodgy about it at all. Buyer was prepared to pay that much obviously. (madness I agree but I see it a lot in auction rooms...not all of us out there are hard- hearted investors)However it didn't work as the buyer didn't get to a level where the property could be sold ,so it was passed in.
Like I said -very common and not at all dodgy. The buyer would not have raised his bid if he didn't want to

[outspoken]

I've had this done to me.
I was at an auction of a property I wanted to buy. I was really only there on the off chance it went cheap because I couldn't afford what I'd been told it would probably go for.
So, anyway I bid to my maximum against two others, One other & I dropped out, then it stalled. The REA came over to me and asked me to keep bidding up to (and she gave me a figure) as this was below reserve.
Long story short, I did bid up to that figure, the other bidder went $1,000 over me and the property was still passed in.
The winning bidder got to negotiate and eventually bought the property for $2,000 less than he bid.
I don't know if any of that was illegal, I was green, green. I would never do it again.

But maybe in this scenario, they were hoping someone would come in over this other guy as a true buyer.

[67910241]

I've had this done to me.
I was at an auction of a property I wanted to buy. I was really only there on the off chance it went cheap because I couldn't afford what I'd been told it would probably go for.
So, anyway I bid to my maximum against two others, One other & I dropped out, then it stalled. The REA came over to me and asked me to keep bidding up to (and she gave me a figure) as this was below reserve.
Long story short, I did bid up to that figure, the other bidder went $1,000 over me and the property was still passed in.
The winning bidder got to negotiate and eventually bought the property for $2,000 less than he bid.
I don't know if any of that was illegal, I was green, green. I would never do it again..

This sounds like a really unethical thing for the REA/Auctioneer to do. They basically blatantly screwed their client out of the better of the two deals. If I were the vendor and knew about this, I'd take them to court (can't see how the vendor wouldn't approach you too if you actually had a higher bid minutes before - have you told us the whole story?).

Besides, Dave's anecdote is sort of different, his situation features a buyer going 23% above where all the other bidders stopped. It sounds like sheer stupidity bordering on suicidal masochism. I find it hard to believe that there are many buyers out there that are that moronic (or recklessly ignorant). Some dodginess not blatantly acknowledged to Barfoot by the vendor sounds more plausible, especially since it is at least a theoretical possibility.

The buyer had an absolute position of power by being the highest among the otherwise low bidders, yet he chooses to give it away to the vendor. He's either an incredible fool or Mother Theresa, or vendor's accomplice. But Mother Theresa, bless her soul, is dead, and incredible fools have all already maxed out their credit bying property last year.

[outspoken]

Actually 679... they got a better deal for the vendor, because the 2 of us had stopped and the other was way under.
By asking me to bid higher, they got the other buyer up close to reserve. I stopped short, he bid 1k over me, the vendor settled with him for the same as my last offer.

The point I was trying to make is, that guy bidding at your B&T auction bid up to nearly the reserve under coaching from B&T, it got passed in, so no damage done to him. There was an off chance that someone came in above him at some point at which time they could have had a genuine buyer. Something that this guy was obviously not!

[Davo36]

I don't think it's dodgy for B&T staff to ask punters to bid higher. In fact they're doing their jobs by doing so in that they may get more money for their vendor. So I wasn't suggesting the B&T staff were dodgy in any way.

I was just flabbergasted that:

a) Some idiot would pay so much for a property that is clearly not worth it (it's been on the market at that level for over a year, they haven't been able to sell and have been taken to a mortgagee sale) and

b) Why would anyone bid against themselves? i.e. increase their own bid? If it were me, I'd just sit tight, let it get passed in and then negotiate afterwards. I see no benefit at all in saying "OK, here's another $40k, Not enough? Ok here's another $25k...".

I really wonder what the staff say to these people to get them to suddenly spend tens of thousands more of their own money when clearly no one else is prepared to.

David

[princess]

because they LIKE the house.

Simple.

Not every buyer is in it for the maths.

You cold fish, all of you, don't you remember EMOTION??

:-)

[67910241]

because they LIKE the house.

Simple.

Not every buyer is in it for the maths.

You cold fish, all of you, don't you remember EMOTION??

:-)

If so, why emotionally stop at 431, and not let the emotion carry you all the way to 440 where the vendor would have probably accepted?

I'd still say there's been some emotion indeed - I genuinely like most of my mates.

[princess]

maths probably still figures somewhere - esp if its your first home, and your are pre-approved up to $430k but reckon you could scrape together an extra grand but no more.

I do agree, bidding against onself is not that sensible.

[cube]

I've seen a buyer talked up $70,000 before the reserve was lowered. I was flabbergasted - why not stop, and use your highest bidder's rights to negotiate without revealing how high you are prepared to go.

I've had this done to me.
I was at an auction of a property I wanted to buy. I was really only there on the off chance it went cheap because I couldn't afford what I'd been told it would probably go for.
So, anyway I bid to my maximum against two others, One other & I dropped out, then it stalled. The REA came over to me and asked me to keep bidding up to (and she gave me a figure) as this was below reserve.
Long story short, I did bid up to that figure, the other bidder went $1,000 over me and the property was still passed in.
The winning bidder got to negotiate and eventually bought the property for $2,000 less than he bid.
I don't know if any of that was illegal, I was green, green. I would never do it again.

But maybe in this scenario, they were hoping someone would come in over this other guy as a true buyer.

Firstly, the reserve is supposed to be known only to the auctioneer and the vendor, not the REA, so telling you that $x is below the reserve is mis-using information that the REA shouldn't have had.

The other point is that the vendor could, at any time, have told the auctioneer that the house was on the market, and if you had ended up as the highest bidder, you'd be writing out a cheque that you didn't intend to!

[outspoken]

That's right Cube, why I would never do it again.

Not to mention, never use that RE outfit ever!