Going once, going twice... top auctioneer shares secrets of trade
Auctioneering - there are no formal qualifications required, you sell a product that isn’t yours and its execution is a hybrid public display of street theatre, psychology and sales craft.
As careers go, auctioneer is one of the more peculiar.
There are no formal qualifications required, you sell a product that isn’t yours and its execution is a hybrid public display of street theatre, psychology and salescraft.
Not many kids grow up saying they want to become a property auctioneer – and Paul Tzamalis was no exception.
Now the titleholder of Senior Auctioneer of the Year, as awarded by the Real Estate Institute of Victoria, Mr Tzamalis had completed a science degree, travelled the world and returned home unsure of what career path to pursue.
Some sage advice from mother proved life changing.
“She reminded me that like many migrants who came to Australia in search of a better life, my grandfather had been an avid property investor, and his brother had run a successful agency in Albert Park,” he said.
“Mum suggested my outgoing personality might suit real estate sales and the rest is history.”
The 33-year-old from Bulleen in Melbourne’s inner east is now a nationally recognised leader in commercial property auctioneering and enjoys an exciting career as Specialist Independent Auctioneer for The Auction Company, a business he started in 2017.
It was during his ‘apprenticeship’ with global commercial property giants CBRE that colleagues encouraged him to try auctioneering.
The perception that all auctioneers are gregarious and confident is not necessarily true, even if he himself is both.
“I suspect my colleagues recognised my enthusiasm for performing in front of a crowd, along with my outgoing nature,” he said.
“But not all auctioneers are cut from the same cloth; they come in all shapes and sizes, and there’s space for everyone.
“I learned early on that being an auctioneer requires you to find your own character and style while paying close attention to the key fundamentals.”
Whether orchestrating residential or commercial auctions, Mr Tzamalis said the auctioneer needed to speak the buyers’ language, focusing on the motivations for the purchase and understanding the detail of the asset being sold.
But there were also differences.
“In residential, the key notes are usually cosmetic, like style, decoration, improvements and location, and the buyer is often emotionally invested in the transaction, particularly if they plan to occupy the home,” he said.
“In commercial you’re dealing with a different level of asset and buyer.
“Commercial property is called that for a reason; it’s commercial, and it usually boils down to the numbers around things like rental yield, land rate, development restrictions, and other variables that all need to stack up in order to seal the deal.”
Tactics and trust
Although there is not a lot of equipment beyond the obligatory gavel, auctioneering comes with its own jargon, methodologies, and secrets.
Auctioneers will frequently speak rapidly, a rhythmic monotone intended to lull onlookers into a conditioned pattern of call and response, known in the trade as auction chant.
Anchoring is any aspect of any auction, whereby an initial price expectation is set as a sort of anchor point before bidding begins at lower levels. A publicly known reserve also acts like a typical anchor, influencing potential bidders to value the good at or above the reserve price.
“Of course, there are techniques we use to drive an auction forward, but ultimately, all we’re doing is facilitating a transaction between two parties, both of which have a price in mind, and we need to help them meet in the middle and in order do that, they have to trust us,” Mr Tzamalis said.
“Trust is a critical part of an auctioneer’s role.
“We have to build deep trust with our agent and their vendor because ultimately they’re making a significant decision to sell, and our advice throughout the sales campaign and on auction day can be critical to influencing their tactical decisions.
“Then, it’s our role to stand up in front of a crowd of people we probably don’t know, and convince them to trust us, and the process.
Can’t sing, can talk
Mr Tzamalis said good auctioneering boiled down to the fundamentals – knowing the property, knowing the buyer, understanding the legalities, having the experience to handle unexpected circumstances, then stringing it all together to keep the auction ticking to achieve the best possible outcome for the vendor.
This approach has culminated in the coveted Senior Auctioneer of the Year.
Judged by a panel of four award points across the key areas of assessment, including initiation of proceedings, standard of dress, clarity and manner of delivery, description of property, handling of bidding, and calculation of bids.
“Outside of that, the style and flare of the individual is what’s unique and where each auctioneer can share their personality and bring their own style to the craft.
“This is what I love in particular, as it gives me the opportunity to perform before a crowd, which is what I love to do.
“I can’t sing, so auctioneering was a great option for me.”
Victorian commercial and careers
Elevated residential values – Melbourne’s house prices were up 12.5 per cent year-on-year as of the start of March – and changes to Victoria’s residential rental laws are pushing some would-be owners to look at alternatives.
Contrary to the doom and gloom around work-from-home adversely hitting office markets, the Property Council of Australia’s latest Office Market Report revealed Melbourne posted the second strongest demand for CBD office space, just behind Perth.
“We’ve heard a lot of speculation around the future viability of office buildings but I don’t agree that this is going to be a major issue, because the way we choose to use office buildings will change.
“I suspect we’ll see an increase in co-working setups, which means the available office space will still be tenanted, it’ll just be used differently, which is a good thing.
“Naturally, for the CBD, office workers returning will spur sectors like hospitality and retail, which have been largely dormant for the last two years.”
There are other sections within the commercial sector that are booming, Mr Tzamalis said.
“The industrial sector has seen unprecedented demand, with COVID being a key driver as investors look for long term security.
“Childcare and medical have also been benefactors of this shift, given they’re critical infrastructure to the day-to-day operations of communities.
“Large format retail such as appliance stores and supermarkets have also prospered, for the same reasons.”
And for any office, retail or hospitality worker looking for a career change, would he recommend auctioneering?
“Demand for independent auctioneering services like ours is on the increase, and there will be opportunities for people who are either entering the industry at the beginning of their careers, or undergoing a career transition, to get involved and make a career out of auctioneering.
“I would thoroughly recommend it as a career to anyone, and especially to people who love to perform in front of a crowd.
“In my experience actors, radio presenters, journalists, sportspeople, and all sorts of other performers can make excellent auctioneers, once they understand the fundamentals of facilitating a transaction.”