Property auctions have been around for years. These have in recent years gone beyond forced sales and liquidation auctions to being a legitimate form of selling your property.
In this episode of The Property Pod we take a look at the growth of online auctions, especially in the context of Covid-19.
Cape Town-based MC du Toit, CEO of auctions and sales at BidX1 South Africa, shares some insights on online property auctions.
Below are highlights of the interview. Listen to the full podcast in the link above or download it from Iono, Spotify or Apple Podcasts.
“I’m a fourth-generation auctioneer, so I remember growing up next to the cattle ring with my dad, auctioning off some cattle and with me stamping some of the buyers’ numbers onto the cattle. So that was quite fun.”
“In 2018, I started talking with BidX1. The head office of BidX1 is in Dublin, Ireland. They were looking into South Africa, about opening here, and bringing BidX1 to South Africa. I knew at that stage auctioneers needed to change.
“The normal standard method of doing auctions was old, maybe because I’d been going through it for four generations and not much had changed since then. So I decided, look, I’ll take the risk.”
In November, BidX1 South Africa will mark three years in business …
“We are purely online. For online properties to work, you need to be fully trusted. You can’t take away the human aspect of selling property; people want to talk to an expert.”
“When you are on a live auction you rarely have direct access to the auctioneer as he’s standing on the podium, and pretty much you can’t ask him any questions during the auction. So that’s one of the big advantages of an online auction, as well as the transparency.”
So how does it all work?
“I’ll take you through our process. You register, you go through the normal Fica process. All bidders have to go through the same process. You can’t bid if you’re not a registered. You’ll be provided with a number once you’ve paid a small refundable deposit. Then, on the auction day, you bid against the other registered bidders.
“You’ll be allocated a bidder number, which will be displayed on your laptop, cellphone or whichever device you’re using, and that will be displayed in real time. So you’ll see your other bids coming through.
“Everyone can see the bid, the company included – it’s an open public auction.
“There’s also an extension time, so that another bidder can’t snipe you at the death of the auction. Sniping means someone waits till the last second to place their bid, and you don’t have enough time to place your counter bid.”
“I think the biggest positive advantage to buyers is that you can place your bid on any device from anywhere. There’s also no paperwork involved.
“We don’t talk live. We felt that you’re either online or you’re not; you can’t mix the two. You’ll sit in front of your computer and basically, once a bid comes in, you’ll be able to click and place your bid … You’ll be able to monitor the entire auction.
“I won’t be talking fast, like I did in the past and you don’t know where you are. You’ll be able to see it very easily.”
Du Toit says BidX1 South Africa has “definitely” benefitted from Covid-19.
“We do operate online and we all know what the pandemic did with regard to online and digital and e-commerce … Pre-Covid we were the different ones. We were swimming upstream and it was a different type of pitch that we had to learn.”
“Everyone is locked onto the digital and online side, which is great and it’s the right way to do it. Lockdown was still difficult; I won’t lie to you. But the positive on our side is we could transact, and we actually did some very good transactions.”
“What happened in 2020 [with Covid-19] is our buyers increased by 250%; our average bids increased by about 47%.”
“We had one of our biggest months last year, where we sold just under a R100 million worth of property.
“The biggest transaction that went through the auction platform itself was around R73 million.”