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A comparison of the appraisal process for auction and private treaty residential sales

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  • Stevenson, Simon
  • Young, James
  • Gurdgiev, Constantin

Abstract

This paper examines residential sale mechanisms from an appraisal perspective and empirically tests for differences in the valuation process for auctioned and private treaty sales. We test the hypothesis that agents use different criteria in preparing the guide prices for auctioned housing, with an element of under pricing in order to aid in the marketing of the property. The empirical tests are undertaken on a sample of auctioned and private treaty sales in Dublin, Ireland for the period of 1997-2004. We find that the evidence is consistent with the hypothesis that agents do adjust valuations for auctions to attract additional potential bidders.

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  • Stevenson, Simon & Young, James & Gurdgiev, Constantin, 2010. "A comparison of the appraisal process for auction and private treaty residential sales," Journal of Housing Economics, Elsevier, vol. 19(2), pages 145-154, June.
    • Handle: RePEc:eee:jhouse:v:19:y:2010:i:2:p:145-154
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    Cited by:

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    2. Alison Watts, 2016. "Auctions Versus Private Negotiations in Buyer-Seller Networks," Games, MDPI, vol. 7(3), pages 1-14, August.
    3. Jun Kang & Hyun Jun Lee & Seung Hwan Jeong & Hee Soo Lee & Kyong Joo Oh, 2020. "Developing a Forecasting Model for Real Estate Auction Prices Using Artificial Intelligence," Sustainability, MDPI, vol. 12(7), pages 1-19, April.
    4. Simon Stevenson & James Young, 2015. "The Role of Undisclosed Reserves in English Open Outcry Auctions," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 43(2), pages 375-402, June.
    5. Shi, Song & Zhang, Hong & Zhang, Jun, 2022. "The impact of a home purchase restrictions (HPR) policy on the distressed property market in Beijing," Journal of Housing Economics, Elsevier, vol. 58(PB).
    6. Boland Michael A. & Crespi John M. & Turner Tracy M., 2014. "Measuring Sunk Costs in Agricultural and Food Industry Assets: Why Some Assets Sell Below Appraisal," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 12(1), pages 1-11, January.
    7. Deborah Levy & Zhi Dong & James Young, 2016. "Unintended consequences: the use of property tax valuations as guide prices in Wellington, New Zealand," Housing Studies, Taylor & Francis Journals, vol. 31(5), pages 578-597, July.
    8. Simon Stevenson & James Young, 2015. "The probability of sale and price premiums in withdrawn auctioned properties," Urban Studies, Urban Studies Journal Limited, vol. 52(2), pages 279-297, February.
    9. Rosane Hungria-Gunnelin, 2013. "Impact of Number of Bidders on Sale Price of Auctioned Condominium Apartments in Stockholm," International Real Estate Review, Global Social Science Institute, vol. 16(3), pages 274-295.

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