New buying and selling method underway in Ballarat

A THIRD major option for buying and selling homes in Ballarat is been launched.

Known as Open Negotiation and run online or via smart phone app, the system is essentially a mid-way point between a traditional auction and a private treaty sale.

McGrath Ballarat director Daniel Nestor recently became accredited to operate the process in the city.

“It’s a flexible terms auction,” he said. “What that means is a bidder can bid with terms or conditions in place.

“In a traditional auction sense you would turn up on the day and be required to bid unconditionally, which means at the fall of the hammer if you are the highest bidder you’ll be required to pay a 10 per cent deposit on the spot and the contract of sale is unconditional.

“With Open Negotiation you don’t need to be an unconditional bidder. When you submit you offer via the online platform you submit the terms or conditions that are attached to your offer.”

Along with a price and closure length terms, offers might often involve conditions like finance approval and building and pest inspections. They are the kind of things normally included with a private treaty type sale.

Once submitted the conditions are considered by the vendor who decides to accept them or not. If it’s thumbs up, the buyer’s terms are then included in subsequent offers.

Open Negotiation was launched in Perth during the mining downturn where it saw clearances of properties that had been sitting on the market for significant amounts of time.

It’s also been successfully operated by the McGrath office in Geelong for about 18 months.

Mr Nestor said the process was developed following frustration with the two traditional ways of selling property, and that’s where the other element of Open Negotiation comes in, you know where you stand when bidding.

“It works for the buyer because there is absolute transparency around the offers that have been made,” he said.

“So if a buyer was to miss out on purchasing they would only have themselves to blame because they knew where the best offer was.

“The reason it works for a vendor is obvious. When you put a property to competition that’s what drives price.

“Competition breaks records in the pool, and on the track and it’s what gets you the best price for your home. When you’ve got multiple people competing against one another, as opposed to against the vendor, that’s when you end up with the best possible result.”

Kelly Dubberley currently straddles both sides of the fence.

He and his family have been looking for an acreage property on Ballarat’s south-eastern fringe to be closer to his job in Geelong, while at the same time looking to sell the former family home and current investment property in Tress Street, Mount Pleasant.

Mr Dubberley said his experience trying to buy via the private treaty process had been frustrating with limited opportunity for him to put his best offer forward.

“We’ve probably looked at 10 different properties and out of those there’d be six that we put offers in on and we’ve had three different agents say they only give you an opportunity to put one offer in,” he said.

“So you’ve basically been made you put your first and final offer, and that’s it. There’s no negotiating. With three of those 10 properties we would have come back and gone a lot higher, they were just the perfect fit for us as a family.

“I actually don’t believe the vendors know that some agents are actually doing it that way. You want to get the best value for your number one investment. If I was in that position, I’d be absolutely filthy that agent didn’t do the best for me and go back and get them counter offering.”

When it came to selling his Mount Pleasant property, Mr Dubberley said the team at McGrath Ballarat approached him with the opportunity to use Open Negotiation.

He said the trust and rapport he’d developed with the team at McGrath, combined with his experience in trying to buy made the decision an easy one.

“Dan approached us and said there’s this new thing and floated the idea with me and my wife, Stacey, and I said let’s go with that, 100 per cent,” he said.

“It’s different and new, and without bitching about some other real estate agents, the way that we’ve been treated is ridiculous.”

For more information check out Open Negotiation via openn.com.au.