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Rawson Auctions Gauteng pioneers 'bid with a bond'

23 Jun 2015

The Rawson Auctions Gauteng franchise has introduced a system, which is thought to be a first in South Africa, whereby certain bidders are able to make offers on homes at auction subject to them getting bond finance.

The Rawson Auctions Gauteng franchise has introduced a system, which is thought to be a first in South Africa, whereby certain bidders are able to make offers on homes at auction subject to them getting bond finance.

This is according to Rob Whiteley the franchisee for Rawson Auctions Gauteng, who says traditionally, bidders at auction have had to pay cash for property with no suspensive condition in the agreement for finance.

“However, we have discovered that many potential auction attendees don’t have ready cash, maybe it’s invested elsewhere, but would certainly qualify for a bond and wish to buy a home at auction.”

He says in the middle and upper residential home market today there are large numbers of “end user” buyer, someone who wants to live in the property rather than rent out.

“We’ve therefore arranged with the Rawson Property Group’s bond origination division, Rawson Finance, to prequalify such potential buyers who have conventionally been excluded from the auction process.”

The Rawson Finance Gauteng team will review their credit and financial position and, if satisfactory, will issue them with a Buyer’s Qualification Certificate (BQC). 

This will indicate the size of the bond for which Rawson Finance believes the buyer will qualify and, armed with the BQC, the bidder can then register and bid at one of our auctions knowing we will accept his offer subject to his getting a bond of the size stipulated, says Whiteley.

“So far as we know, this has never been done before in South Africa and it is, of course, proving very popular indeed.”

Whiteley and his colleague Tanya Jovanovski, franchisee for Rawson Auctions Western Cape, say that auctioning a property has become increasingly popular and a more acceptable method of disposal of immovable residential property.

“Quite often this is because a quick disposal has become essential”, he says.

“This can be due to many reasons; relocation, promotion, divorce, financial constraints, downsizing, or even to comply with an Order from the Master of the Court.”

About fifty per cent of their auction stock is referred by a Rawson franchisee or agent whose client requires a quick sale, he says.

Whiteley says that while on-site auctions still remain very popular, they have this year had great success with ballroom or multiple auctions where many properties are showcased in one central location on one day.

At one such event in February, he says 30 of the 41 properties were cleared (sold) with several bidders buying 4 or 5 properties each.

“Sellers of commercial assets, like shopping centres, industrial units, blocks of flats, and so forth, have utilised the auction platform for many years as the preferred disposal method and we are increasingly finding our Rawson Commercial franchisees placing their clients’ properties with us to effect a speedy sale.”

He says higher priced residential properties are now once again popular with auction buyers, and among those his franchise has sold recently include an avant-garde four bedroom cluster in Centurion for R3.1 million and a four storey penthouse in Sandton for R11.4 million.

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