A real estate auction is a public sale led by a licensed auctioneer. Auctions are ideal for unique or high-demand properties in sought-after areas. They can offer high visibility and generate strong interest from bidders.

During the auction process, buyers place competitive bids on your property. The property is sold to the highest bidder if their offer meets or exceeds the reserve price.

You and your agent decide on a reserve price, this is the lowest price you are prepared to sell your property. If the reserve price is not reached, the property will be ‘passed in’ and not sold.

You should be aware:

• there’s no guarantee of receiving a bid above the reserve price
• auctions can be more expensive than private sales. Costs may include advertising, auction coordination and auctioneer fees. Some auctions include extra expenses like hiring a marquee.

You can also see our advice to buyers on Buying a property at an auction.

Choosing an agent 

In order to conduct an auction, the real estate agent must have a licensed auctioneer on staff or appoint a consultant auctioneer. 

You can check if a real estate agent is licenced by doing an online licence search or by calling 1300 304 054.

Authority to auction 

Before an agent can assist you, they must provide you with an Authority to Auction contract, outlining their services and fees. This contract legally binds both you and the agent to its terms.

Review the contract carefully, and seek legal advice if you have questions or want to make changes before signing.

Before the auction – set a reserve price 

Set the reserve price before the auction. This price is to be kept confidential until it a bid has reached or passed it. The auctioneer cannot sell the property below this price.

To work out your reserve price:

• get to know prices in your area
• use the agent’s estimated selling price as a guide
• consider paying for an independent land valuation

During the auction

• The auctioneer will announce the property's features, title restrictions, and deposit requirements.
• Bidding starts with an opening bid, usually below the reserve price, and progresses as bids are placed.

After the auction

• If the reserve price is met or exceeded, the auctioneer will let the bidders know the property will sell.
• The highest bidder signs the sales contract, which you will sign and accept.
• If the reserve price is not reached, the property is ‘passed in’.
• The auctioneer may negotiate privately on your behalf with the highest bidder or other interested parties to secure a sale.