A $1 reserve! A new West Auckland townhouse worth NZ$700,000 went to auction last week—and the final sale price was…

Last Friday's New Zealand Herald report

 

Last Friday, the New Zealand Herald reported that a newly built townhouse worth NZ$700,000 (pictured above) would go to auction over the weekend with an exceptionally low reserve of NZ$1. The news attracted considerable interest from readers, particularly first-home buyers. The brand-new two-bedroom home, in the Mc Leod Green development at 148 Mc Leod Road in Te Atatu, was reportedly one of the last five unsold homes in the 60-unit development.

 

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Real estate agent Mitchell Eades said the townhouse had a courtyard and a roadside parking space. It was expected to receive its Code Compliance Certificate (CCC) this month, with settlement anticipated in October. Before last Friday, 10 prospective buyers had already planned to attend Sunday's auction, but he expected more to turn up to watch on the day. Both he and the developer were optimistic that the final auction price would reach around NZ$600,000.

 

However, he acknowledged that the final auction price would not be comparable with the prices paid by buyers of the other 55 homes already sold, as some had bought at last year's market peak. According to sales records on OneRoof, recent asking prices for two-bedroom townhouses at McLeod Green were around NZ$700,000, whereas in February last year, asking prices in the development had reached NZ$875,000.

 

 

A lively auction

 

By last Sunday, the auction was packed, just as expected. After several rounds of fierce bidding, a young couple bought the brand-new townhouse for NZ$660,000. The auction reportedly took place in the central open space at McLeod Green. Investors and first-home buyers flocked to the event after hearing the news, each hoping to secure a bargain.

 

Apollo Auctions auctioneer Rob Tulp intended to open the bidding at NZ$1, but an eager bidder quickly offered NZ$100,000. When bidding passed NZ$600,000, Tulp skilfully encouraged further bids, eventually bringing the hammer down at NZ$660,000. Afterwards, the buyers posed for photographs outside the home. The entire auction lasted just over 10 minutes. Although some bidders left disappointed, they may already have set their sights on one of the remaining four homes.

 

Interior photographs of the property

 

Before the auction, agent Mitchell Eades told a Herald reporter: “The reserve for this home is NZ$1. There is no particular reason for selling it at auction with such a low reserve; the developer simply picked a home at random to sell. There is nothing amiss with the auction either.”

 

YIJU has noticed more first-home buyers attending auctions recently, so we have put together some auction tips for reference:

 

1. Experience auctions first-hand: attend several auctions for other properties to observe carefully and get a feel for the process;

2. Research as many aspects as possible of the property you are interested in;

3. Estimate the property's final auction price and work out your budget in advance;

4. Consider asking a real estate agent to help you bid and develop a sensible auction strategy;

5. Bid early, bid quickly and keep bidding until you reach your budget limit;

6. Stay confident.