Online Property Auctions used by French Notaires to Sell Quickly
French Notaires have recently demonstrated remarkable innovation by using online property auctions to offload properties quickly, with one going a step further and using an alternative and seldom-used mechanism.
Notaires in France have started using property auctions as a way to quickly offload some of their properties, with users bidding on everything from farms in the countryside to Villas in Versailles. Lower paid prices, a vastly reduced workload and a quicker process mean everybody gains something from the procedure.
A recent online auction for a two-bedroom apartment in Nantes, pictured below, saw a final price paid of €98,500. This is half or two-thirds below the average price per m2 in the city, depending on which observatories figures are counted. Properties sold at auction are typically in less sought-after locations or in need of some TLC but this case, in particular, is a steal for the right buyer.
A 60m2 villa in Versailles – with adjoining garden space ten times that – is soon to go to auction for a starting price of €700,000.
Another method, the Dutch Auction, was recently used by a Notaire to quickly offload a property. Most famously used by the United States Department of the Treasury when issuing bonds, the idea is simple: start with a high price which gets lowered at regular intervals, and the first bidder to make an offer gets the goods.
The property was a farmhouse of 240m2 located within a terrain of 30,000m2 (about four soccer fields), located in Pont-Saint-Martin in Loire-Atlantique (map, right) with a starting price was €510,000. Once the auction kicked off at midday, every 30 seconds saw the price fall by 2,250 euros for 20 minutes. Three offers were made during the process, one at the starting price which took the spoils.
The Notaire in charge of the transaction, Vincent Chaveau, said that this method has numerous benefits for both buyer and seller.
“In general, when a house doesn’t sell it’s because the asking price is too high. With a sale such as this, the price falls to the right market level. This method also allows buyers to pause for thought. They don’t have to make an offer right after making a visit, but can instead wait for the day of the auction.”
The latter point could be made for property auctions in general, where atypical as well as more affordable properties can be found. They do require a seller who wishes to offload a property at all costs to go ahead – especially in the case of a falling price auction – so don’t expect to see a 3-bedroom terraced apartment in Saint-Germain-des-Pres in any future online property auctions, Dutch or otherwise.
title image © Wikicommons