The Block NZ Auction

Forums › Home Workshop DIY › The Block NZ Auction

1 | 2

Wheelbarrow01

1784 posts

Uber Geek
+1 received by user: 2638

Trusted

Chorus

#1867988 18-Sep-2017 12:15

The way house 2 was auctioned is certainly not unusual, and it was not the result of 'two auctions'.

When I bought my house at auction, I was the highest bidder but it did not reach the reserve. The auction was paused and I was pulled into a back room and advised that I needed to increase my bid to the reserve price to have any chance of owning the property. I was then told what that magic figure was, and I agreed to increase my bid to that level.

At that point, I initially thought I had just bought the property, however when we returned to the auction room, my higher bid was announced and the property was placed on the market, but anybody else in the room was free to make additional bids. As it turns out, there were no more bids and I won the auction at the reserve price, and the house was sold "under auction conditions" - ie an unconditional sale.

Had I not increased my bid to the reserve level, The auction may have resumed and then passed in for post auction negotiations with one or more parties. Any sale as a result of those negotiations is not necessarily "under auction conditions".

The real issue here is that the organisers of the Block auctions allowed another auction to proceed (Stace & Yanita's) while they boys' auction was effectively paused. The auctioneer did not make this clear at all, using the phrase "passed in" when in fact it was anything but.

Stace and Yanita were indeed ripped off, but not because the boys' house was auctioned twice. It wasn't, but the auctioneers should have delayed Stace and Yanita's auction until the boys house had either been sold or properly passed in as per the correct definition.

Whether the reserve on the boys' house was lowered during the negotiations phase I am not sure. I'd have to go back and review the footage. If it was lowered to meet the existing highest bid, then that's a shocker. Their auction should only have been allowed to resume if the highest bidder had upped their bid to meet the pre-ordained reserve. But this should have all been done and the deal concluded before Stace and Yanita's auction started.

I suspect the show producers are to blame for that - they can't have 20 minutes of dead air while negotiations are going on behind closed doors, so they clearly chose to proceed with the next auction, oblivious to how this could seriously alter the outcome.

Satch

1985 posts

Uber Geek
+1 received by user: 259

#1867992 18-Sep-2017 12:18

trig42:

I think this season of The Block has been the worst of the six they have done.

It was painful and horrible TV, and generally I quite enjoy the show. This time, all the teams could even do was painting.

Personalities on the show were not great, and I thought the judging was pretty naff. Hopefully the producers go away and fix the issues this season had (strategic voting got shown up to be stupid, though I'm sure it is encouraged to provide 'drama' for TV).

Plus, whoever though a good time to Auction 4 'premium' homes in Auckland was a week before an election - doesn't take a crystal ball to know that house sales slow down in the run-up to an election.

Another plus - did the same buyer buy 2 or 3 of the houses?

You must have good hammer skills because you hit the nail squarely on the head :-)

For Stacey and Yanni I think it was a bit of karma at play given how badly they played the social aspect of the show. But I agree they were shafted by the dad's being allowed to re-enter the contest for the $100k. Makes the auction order challenge a bit of a farce.

trig42

5889 posts

Uber Geek
+1 received by user: 2094

ID Verified

#1867995 18-Sep-2017 12:20

^ I think the bid they came back with was higher than what it was passed in for. I'd say like yours, they were told the reserve, then when it came back to Auction 'On the Market' others rejoined.

Obviously a lot of work went in during the intervening two auctions.

kryptonjohn

2523 posts

Uber Geek
+1 received by user: 953

Lifetime subscriber

#1867997 18-Sep-2017 12:25

My poor wee 10yo was such a fan of Ding and Zing that he was in tears about it :-(

Personally can't stand the show, particularly the main presenter.

Oblivian

7345 posts

Uber Geek
+1 received by user: 2117

ID Verified

#1868005 18-Sep-2017 12:40

Mark has had to come out defending it. Stating it was paused not passed in. Yet that was the phrase used multiple times.

And they backed it up with if as it didn't sell at auction, they only get the profit margin if one exists.

No point in an order if you get a 2nd run if all 3 had stopped.last night eh..

3hrs after the fact it still wasn't ondemand. It is now but I'm willing to bet it's been edited down to the right timeslot length magically missing those phrases.

Satch

1985 posts

Uber Geek
+1 received by user: 259

#1868017 18-Sep-2017 13:07

I checked Ondemand (I actually had to watch the last 10 mins this morning as my recording last night ended before the show finished..) and the auctioneer said it was being passed in and now "open for conditional interest". Mark then said to the guys several times during the post auction interview that it had been passed in. He said although Ling and Zing currently lead the competition, the Dad's house now goes to conditional negotiation and if it sells they could take some profit.

I guess it was not spelled out in very simple terms that they were no longer eligible for the show's $100k prize but it was implied by the way the on air discussion went.

HP

Shop now for HP laptops and other devices (affiliate link).

eracode

Smpl Mnmlst
9333 posts

Uber Geek
+1 received by user: 6203

ID Verified

Trusted

Lifetime subscriber

#1868057 18-Sep-2017 14:20

trig42:
did the same buyer buy 2 or 3 of the houses?

I was wondering the same thing and I think that's correct. An Asian buyer? If so, not really a good look in election week when housing is an issue. Winston Peters could (maybe should) have a field-day with this.

Sometimes I just sit and think. Other times I just sit.

Oblivian

7345 posts

Uber Geek
+1 received by user: 2117

ID Verified

#1868077 18-Sep-2017 14:47

Just replayed on 3

Have to watch 3+1 to see how edited it is..

mattwnz

20515 posts

Uber Geek
+1 received by user: 4795

#1868130 18-Sep-2017 15:51

Wheelbarrow01:

The way house 2 was auctioned is certainly not unusual, and it was not the result of 'two auctions'.

When I bought my house at auction, I was the highest bidder but it did not reach the reserve. The auction was paused and I was pulled into a back room and advised that I needed to increase my bid to the reserve price to have any chance of owning the property. I was then told what that magic figure was, and I agreed to increase my bid to that level.

At that point, I initially thought I had just bought the property, however when we returned to the auction room, my higher bid was announced and the property was placed on the market, but anybody else in the room was free to make additional bids. As it turns out, there were no more bids and I won the auction at the reserve price, and the house was sold "under auction conditions" - ie an unconditional sale.

Had I not increased my bid to the reserve level, The auction may have resumed and then passed in for post auction negotiations with one or more parties. Any sale as a result of those negotiations is not necessarily "under auction conditions".

The real issue here is that the organisers of the Block auctions allowed another auction to proceed (Stace & Yanita's) while they boys' auction was effectively paused. The auctioneer did not make this clear at all, using the phrase "passed in" when in fact it was anything but.

Stace and Yanita were indeed ripped off, but not because the boys' house was auctioned twice. It wasn't, but the auctioneers should have delayed Stace and Yanita's auction until the boys house had either been sold or properly passed in as per the correct definition.

Whether the reserve on the boys' house was lowered during the negotiations phase I am not sure. I'd have to go back and review the footage. If it was lowered to meet the existing highest bid, then that's a shocker. Their auction should only have been allowed to resume if the highest bidder had upped their bid to meet the pre-ordained reserve. But this should have all been done and the deal concluded before Stace and Yanita's auction started.

Surely the agent should have told you that it was going back to the room?

If I was in that situation I would tell the agent I would need to sleep on it, so it then couldn't go back to the room. Especially if you were the only game in town, becuase buyers should have the power in that situation, as you don't 'need' to buy, that house, but the seller needs to sell, otherwise they could incur extra sales costs and remarketing. I guess they could then negotiate with the next highest bidder, so I guess it also depends on how badly you want the property, but they could have also said they couldn't pay any more. But if noone was bidding up to the price the seller wanted in the room, then they would likely be asking more than the market price.

You do need to remember that the agent is working for the seller and not you. They only have to be 'fair' to the buyer, but they have to try and get the best price for the seller. If I was doing this, I would also ask for a normal sale a purchase agreement, not an auction one if negotiating after the auction, and that way you can put conditions into it eg subject to extra finance. When buying at auction, you are carrying more risk as a buyer, as the sale is usually unconditional, so that risk has to be accounted for in the price you pay.

In the case of the block, the final house to be auctioned potentially has an advantage because if any buyers were hanging out to buy at least one of the houses, that would be the final house they could buy.It wasn't a great situation for contestants . But that is life. Contestants should have realized that there was the risk that they wouldn't make any money, especially as Aucklands market has flat-lined. At the end of the day one of the main winners were the agents. If it was 4% commission they would have made nearly up to 200k

Maybe that could be the next series, buying and selling houses as houses sales people, and seeing who can make the biggest commissions?

Oblivian

7345 posts

Uber Geek
+1 received by user: 2117

ID Verified

#1868131 18-Sep-2017 15:54

Just watched replay.

Somehow... It went totally stale. At 1.205

It resumed 20k higher at 1.225.

One could argue the price of the last auction drove the market price given it raised the group value suddenly to 1.5

But still don't get how the multiple 'passed in' comments become resumed.

Even the competitors were shaking heads not understanding. They looked dumbfounded how it was able to come back for another go.

mattwnz

20515 posts

Uber Geek
+1 received by user: 4795

#1868134 18-Sep-2017 16:03

Oblivian: Just watched replay.

Somehow... It went totally stale. At 1.205

It resumed 20k higher at 1.225.

One could argue the price of the last auction drove the market price given it raised the group value suddenly to 1.5

But still don't get how the multiple 'passed in' comments become resumed.

Even the competitors were shaking heads not understanding. They looked dumbfounded how it was able to come back for another go.

Did they not say what the reserves or valuations were prior to the sale? Anyone buying at that price would likely have got their own valuation done too.

Mighty Ape

Shop now at Mighty Ape (affiliate link).

Oblivian

7345 posts

Uber Geek
+1 received by user: 2117

ID Verified

#1868139 18-Sep-2017 16:17

mattwnz:
Oblivian: Just watched replay.

Somehow... It went totally stale. At 1.205

It resumed 20k higher at 1.225.

One could argue the price of the last auction drove the market price given it raised the group value suddenly to 1.5

But still don't get how the multiple 'passed in' comments become resumed.

Even the competitors were shaking heads not understanding. They looked dumbfounded how it was able to come back for another go.

Did they not say what the reserves or valuations were prior to the sale? Anyone buying at that price would likely have got their own valuation done too.

Nope. Reserves were fluctuated based on budget (raised where there was a shortfall and decreased like the dads for being under) but until the auctioneer stopped saying 'we need more' at every increment which was the case on EVERY one, the reserve was not known.

This may have been made known during mediation. But at that rate, you would have expected a private too and frow between parties. Not open it to the floor again now all 4 reserves and average value were all but revealed

Sam91

620 posts

Ultimate Geek
+1 received by user: 183

#1868149 18-Sep-2017 16:40

kryptonjohn:

My poor wee 10yo was such a fan of Ding and Zing that he was in tears about it :-(

Personally can't stand the show, particularly the main presenter.

He can donate his pocket money here.

Oblivian

7345 posts

Uber Geek
+1 received by user: 2117

ID Verified

#1868198 18-Sep-2017 19:19

Mark was on the project tonight, again defending his ballsup (and somehow an auctioneer who does this daily) in wording

Kept referring to it as a Paused auction, and being 'a thing' they weren't aware of etc etc. Sure never heard that word battered around. At all.

Were also surprised it ended in a bidding war. Hell, lets put the first 3 back up tomorrow for another auction and see how it goes. And then the next day.. and the next..

Nevermind, thats bound to happen anyway.

1 | 2