The Victorian Greens want to ban street auctions.
Australia is the only country where such auctions (where a property is sold on the street outside it) are performed.
Around the world, homes are generally sold by private sale.
The State Government has not signalled support for the Greens’ plan, which comes ahead of the next state election in November.
If this change did come into effect, what would it look like?
Background
Across the country, Saturday is auction day.
Potential buyers can walk through a property, and, if they’re interested, register to bid at auction in front of the property.
This practice is unique to Australia.
Worldwide, the typical process is prospective buyers simply make an offer when a home is listed for sale – which also happens in Australia.
As an example, Raine & Horne reports around 30% of residential sales in Melbourne are through auction.
Private sales tend to be more frequent in the regions and outer suburbs.
Greens’ plan
Your contribution ensures The Daily Aus can continue doing the work you love.
I want to give $10 monthly to help TDA keep doing the news.
Your details:
This week, the Victorian Greens announced plans to abolish street auctions in the state.
Under this plan, reserve prices would also need to be disclosed before sale; real estate and buyers’ agents would declare their fees upfront; and vendors would have to pay for building reports.
Victorian Greens housing spokesperson Gabrielle de Vietri said: “Most countries manage to sell homes without turning it into a bidding war on the footpath. Victoria can too.”
“Street auctions are designed to create a frenzy. That’s great if your aim is to drive prices higher. It’s terrible if you’re trying to buy a home,” she said.
Responses
A Victorian Government spokesperson told TDA: “Auctions need to be made fairer and more transparent and that's exactly what we're doing.”
They flagged that later this year, laws requiring vendors’ reserve prices and sold prices to be published will come into effect.
In line with the Greens’ plan, the Government is looking to require vendors pay for building and pest inspections.
Opposition
Shadow Consumer Affairs Minister Jade Benham called auctions “open, transparent and fair.”
“Home buyers can see the competition with their own eyes and decide what they can afford, rather than having property sales pushed behind closed doors,” she said.
Benham said they were also a benefit to vendors who can “respond to the market on the day.”
