Today’s Ruby Assembly Soapbox is an opinion piece in its true form. A little ranty, a little funny, a lot honest. You know, a dinner table discussion with friends. So, welcome to my table, friend. I’d like to discuss The Block phenomenon, and the deleterious effect it has on the real estate industry and auction system. It has done to the local property market what Jessica Simpson and Nick Lachey’s reality TV show ‘Newlyweds‘ did for the institution of marriage. Trivialised, stereotyped and misinformed. So let’s look a little deeper at The Block and how it represents the real estate profession and auction system.
As many of you know, a large number of my clients are in the real estate industry and I have an innate understanding and regard for how difficult and unappreciated this role is in the community. I also edit a zine called Home Truths Melbourne which focuses on auction culture in Melbourne. As an ex-auctioneer myself, there’s nothing I don’t love about a good auction. I think that it is a transparent, clean way of transacting a home which brings a marketing programme to a clear finish and allows the public to compete openly and with confidence. A well-run auction campaign (quoting issues aside… ) creates excitement and demand for a property, and removes the murky and uncomfortable process of ‘dutch auctions’ or similar.
The Block has a convoluted premise which doesn’t serve to clarify what makes a property investment and subsequent renovation a success. Is the main focus of the show to win the popular vote (which I understand to result in a car) or is it to garner the largest amount above reserve? Only one of these elements is actually under any control by the participants, which is the popularity element. My issue with The Block (please bear in mind, reality TV cheeses me off anyway – unless it involves a Kardashian wedding) is that the television show created a set of circumstances which were highly unnatural (four houses all a little different on the same street, with the exact same auction campaign period, and a closed auction process) and expected a natural outcome ie houses that sold under the hammer with strong competition. I could use various analogies here, but ultimately this TV show has taken an ‘authority’ position on observing a so-called ‘normal’ auction campaign and has likely freaked out Victorian vendors and buyers because the highly publicized campaign was perceived a failure. Can you imagine your average punter at home, thinking “Gosh! They had all that media and did such a great job on the reno – and it still didn’t sell! I won’t use ______ agents and I certainly won’t auction my home!”
I don’t agree that a property passing in and selling afterwards is a failure. The auction campaign has a number of steps, and a passed-in campaign with swift sale thereafter (as I understand has occurred with all the properties on The Block) is still a success. By making the ‘winner’ the only couple who sold under the hammer, you encourage the public opinion that not selling under the hammer is a failure. By asserting the houses as somehow ‘belonging’ to the contestants, a further misunderstanding occurs. The vendor of the home was Channel 9, not Josh and Jenna or Polly and Waz. Channel 9 set the reserve, and it wasn’t set in consultation with the competing renovators, or the agents. Channel 9 paid a princely sum for those properties, and duly wished to recover on their investment – as is their prerogative, like all vendors. The Block’s perceived ‘failure’ is the result of an uncontrollable vendor – and as any agent who has worked in the industry for any period of time knows, an uncontrollable vendor who won’t listen to your feedback or collaborate with you is likely to have a difficult marketing campaign. Agents, take note! If you’ve got a vendor who won’t listen to you – consider whether you’ll enjoy a good working relationship with them.
I really felt sorry for the contestants, and frustrated for the agents (who I understand were working pro-bono in exchange for media coverage) – as they were both relatively powerless pawns in a giant advertising exercise which ultimately hasn’t created confidence in a property market which could do with some encouragement. The only parties I saw that really enjoyed some positive coverage were the buyer’s advocates – which is some recompense.
Thank God there was a proposal on the night and a kick-ass episode of Underbelly to sweeten the deal.
Rant over.
Hi Iolanthe. Some very valid points there indeed. I ‘d further like to add that one of the biggest battles faced by the contestants and agents alike on THE BLOCK was the array of opinions by a number of “so-called-experts” that the homes (single fronts) were worth around $1MILL and were being underquoted (John McGrath and Scott Cam). This inadvertantly deterred many potential buyers from getting involved in the bidding process which led to the dismal outcome on Auction night. The homes were not underquoted and the moment they were assigned an asking price post-auction (within the quoted range and well below $1MILL) buyers flocked back to the homes and fought tooth and nail to get their name on a Contract. The home of Rod and Tanya was re-auctioned between 4 bidders by Jellis Craig and sold $72,000 above the reserve set on auction night. Sometimes the media is the medias worst enemy. The hype killed THE BLOCK just as video killed the radio star !!