Buying or Selling at Auction- What is a Vendor Bid?

In the state of NSW the auction process is one of the most popular ways home owners sell their properties, especially in the Sydney Eastern sea board. There are rules and regulations that the Real Estate Agents, Vendor and Buyers must abide by, they all form part of the auction conditions.

It is wise for any buyer or home seller to be aware of these conditions and understand what they actually mean.

The vendor has a right to make 1 bid on his property and can be exercised through his agent.

As an owner of a property in the state of NSW you are allowed to make 1 bid on your home, in doing so you must be transparent with the public and let them know or your agent will let them know, the vendor is making a bid. This is carried out to protect the vendor.

Why is it so important?

For example: the auction at 2/169 Arden Street, Coogee, NGFarah exercised an auction. Right through the campaign our agents Mitchell Farah + Stephanie Farah quoted the market $950,000 and in a competitive bidding situation we expected slightly more. On the day of the auction the bidding started at $880,000 and finished at $910,000.

The agent made a vendor bid of $950,000 and the property was sold within hours after the auction for $975,000 with 2 genuine bidders competing for the property after auction.

The vendor bid ensured the vendor did not undersell his property; yet let it be known that the vendor bid was also in line with what the agent was quoting which is critical for the agent to maintain the relationship with the buyers.

If an agent makes a vendor bid that’s too high, he will scare the market off and loose trust with his buyers, if an agent makes a vendor bid too low, they could will undersell the property and make it hard to sell at the right price.

Be sure when you’re selling your property to talk to an agent who you feel you can believe, because it is important not only you believe them, but the buyers believe them as well.