Property auction specialist Allsop Space will this week launch an online auction that will allow buyers bid for properties via the internet where the winning bid will be binding. In a property industry first, bidders provide pre-authorised credit card details allowing Allsop to immediately deduct deposit payments, post sale, thereby legally securing the property on the spot.
According to Stephen McCarthy, director of Allsop Space, this is the first online service of its kind, where buyers agree to terms and conditions that allow the auction house to sign the sales contract on the buyer’s behalf. Allsop has retained Ernst and Young as an independent overseer to audit and verify each step of the process and provide transparency if required.
On Friday, a four-week campaign will begin inviting interested parties to register for Allsop’s online-only auction of 70 properties over 24 hours from 10am on March 18th.
All of the properties are residential buy-to-let apartments and houses amounting to a total reserve value of about €8 million. About one-third of the properties are in Dublin with the rest around the country. Some have tenants in situ, but McCarthy says their rights will be retained under tenancy board legislation, meaning lease agreements will be honoured.
Last July, Allsop staged its first online auction of 22 properties, but had to abandon the process due to technical difficulties. Now Allsop has employed a different software provider, EIG, a UK specialist in auction technology, to tailor the process to its needs.
The bidding technology is similar in many ways to that of an eBay auction, except that Allsop’s includes a “bid extension” facility to avoid last minute “sniping” where bidders swoop in the dying seconds with a final top bid just as the clock counts down. The Allsop software will extend the bidding process for one minute each time a bid is made in the final 60 seconds of a bidding period to accommodate counter bids. Bidders can view other bids from their desktops.
“It’s a completely transparent process and it circumvents the frustration often expressed among private treaty buyers who are confronted with a higher offer on a property, but can never be sure of its authenticity,” says McCarthy.
Interested bidders can view properties, conduct due diligence and request title deeds and contracts for sale in the four weeks prior to the auction.
It’s a radical departure in a recovering industry, but McCartney says: “Estate agents haven’t changed how they do business in 45 years, and I think it’s incumbent on people in our business to try new things .. . Not everyone wants to go into a public room to bid.”