The myriad benefits of the digital auction revolution
It has been apparent for some time that the real estate industry is fundamentally changing, with the data revolution permeating all areas of the built environment. The impact has been particularly powerful in the world of auctions where we have seen the online model challenging the more traditional ballroom auction.
The benefits of the digital platform - especially for vendors - are profound and provide insight and security which goes well beyond the industry standard. The transparency created through data is revolutionising an area of the property industry which, for many, was previously shrouded in mystery.
In particular, the steps BidX1 have put in place around legal compliance and anti-money laundering regulations offer an extra layer of security and confidence for vendors. This is particularly important as legislation from HMRC becomes increasingly rigorous.
From the moment a bidder registers on the BidX1 digital platform, our experienced team has visibility over their details and all other interested parties. The registration process includes uploading proof of identification, address and source of funds. However, at BidX1 we have taken security for the vendor one step further, by facilitating a level of bidder commitment in the form of a ‘bidder deposit’. This is a pre-payment which we hold and is relative to the property’s guide price. If the interested party is unable to submit the deposit before the auction, they will not be authorised to place bids. This process ensures that all bidders at the point of registration have skin in the game and are incentivised to bid on the day.
Whilst the ability to support compliance is a huge benefit, perhaps the most interesting factor is the insight gleaned through the data captured. Each step of the process is recorded and unlike a traditional auction, we know exactly who is in the metaphorical room. We can see where interest has been logged and can engage with bidders directly to facilitate a sale. Through generating real-time data, combined with property performance statistics, emerging trends, buyer profiles and bidder locations we can also monitor the vendors’ portfolio against industry trends.
The use of data does not end with the auction itself but continues to provide valuable insight beyond the auction day. If a property doesn’t sell, for example if the reserve price was set based on a third-party independent valuation, our visibility allows us to market test the valuation and drop the price accordingly. We can then offer re-runs of the auction at a later date.
Whilst digital auctions retain many similarities to the traditional model, such as legal due diligence and deal lifecycle which takes the vendor from initial instruction to fall of the digital hammer in eight weeks, there are additional benefits. The digital model is much more flexible. As we are not reliant on fixed dates for booked rooms, we are able to organise auctions or reoffer lots immediately and at the vendors convenience. We can also ascertain pricing pinch points, removing any guess work from the process.
Furthermore, at BidX1 we are one of only two auction companies with dedicated residential and commercial divisions. Our team of experienced property experts provide vendors with insight and advice and help to achieve a better sale, faster.
Innovation and digitisation are extremely important and provide a myriad of benefits to those selling at auction. BidX1 is not afraid to challenge the status quo and with the combined power of a best-in-class team of property advisers with unparalleled data insights, we are able to create an environment where the digital revolution is working to the vendors advantage.
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