Property & Development 31 March 2020

Public Real Estate auctions are prohibited. What happens now?

Upon the recent decision of the Victorian Government to prohibit all public auctions effective from midnight on Wednesday 25 March 2020, many people selling their properties are rightfully concerned as to the marketability of their properties.

While public auctions are no longer permitted as a result of Stage 3 of the Coronavirus shutdown, property owners are being encouraged to market their property by way of private sale.

Cancelled Auctions

All public auctions have been cancelled as a result of the Victorian Government’s decision to implement these restrictions. Consequently in circumstances where auctions have been cancelled, Vendors are questioning their rights under the REIV Exclusive Authority (“the Authority”).

In circumstances where your auction has been cancelled due to the government’s implementation of social distancing measures, under the Authority, the Agent’s failure or inability to conduct the auction (also known as repudiation) is not as a result of the Agent’s decision or action.

Repudiation of the Authority is a result of the Government’s implementation and position to protect the public in these unprecedented times. Therefore a claim cannot be made against the Real Estate Agent for a failure or refusal to act in accordance with the terms contained within the Authority.

Virtual Auctions

There are a large amount of Vendors that unfortunately are no longer permitted to auction their property as planned, despite a marketing campaign already commencing.

In the current environment of uncertainty, it is important to discuss potential changes to the marketing campaign with your Real Estate Agent to ensure a successful sale.

It is apparent that technology will continue to play a major role within the real estate industry. Selling a property by way of auction is still a viable option available to property owners, however adopting a slightly different perspective from the traditional crowd of people standing at the front of a property with the Agent holding a “hammer”. Many Real Estate Agents have the technology available to conduct virtual auctions or adopting the use of open negotiation platforms.

Real Estate Agents have already adopted safe social distancing measures, including limiting open for inspections by appointment only, employing safe distancing rules and readily availability hand sanitisers.

Coulter Legal continues to develop innovative ways in which technology can assist in ensuring everyday life can continue during these difficult and unprecedented times. We are able to prepare the Contract of Sale to ensure that every Vendor is protected for any means in which the property is being marketed, including by way of virtual auction.

If you require any assistance or further advice in relation to the matters discussed in this article, please contact our expert Property & Development team.

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