Consumer Affairs Victoria - and buyers' agents - let down bidders in The Block Elsternwick auction outcome

Consumer Affairs Victoria - and buyers' agents - let down bidders in The Block Elsternwick auction outcome
Consumer Affairs Victoria - and buyers' agents - let down bidders in The Block Elsternwick auction outcome

A leading Melbourne buyers' agent, Mal James, has demanded Consumer Affairs Victoria provide a report on the conduct of The Block Elsternwick auctions.

His concerns revolve around the pass-in of Ronnie and Georgia’s offering:

  • in law
  • in fairness
  • in Frank Valentic’s dudded buyer
  • in the the message it sends about what’s ok at Victorian auctions going forward.

James said he thought the auction did not follow Victorian legislation where the passed-into highest bidder has met the reserve in first-up negotiations.

The house passed in on a $2.6 million bid, $20,000 shy of the reserve. The buyers' agent Frank Valentic made two offers higher than the reserve, but his bids were not accepted.

He or she, by law, buys the property when you meet the reserve, James maintained, noting it did not happen.

James cited the CAV and the government website, adding that the CAV had got caught up in 'the Hollywood' of the televised show.

A Consumer Affairs Victoria inspector monitored the auction.

Laws2

Laws2

"I am not talking about a minor technical breach here," James said.

"If CAV says this is ok, what sort of chance of fair play does any buyer have at any auction?

"Does nobody care about the buyer of was dudded?"

Television viewers saw Ronnie and Georgia’s home passed into Frank Valentic’s buyer as the highest bidder.

His client’s quick post-auction offer met the reserve.

"So why did he not buy it then and there – why did further negotiations continue?" James asked.

"In fact why did Frank’s buyer not buy it at $2,620,000 – the reserve?

"Why would anyone bid at auction under what we saw on The Block – what protections do we as buyers really have?"

Another buyer, represented by Nicole Jacobs, who it wasn’t passed into, who James suggested didn’t even bid during the auction, bought it.

"Why do we have auction laws and rules? Why are Frank or Nicole not speaking out about this – the rightful buyer (Valentic’s) appears to have been completely dudded and by their silence, they as licensed representatives of buyers, seem to imply this sort of auction behaviour is OK," James claimed.

"Fairness was trampled on, the rightful owner tossed aside, the professional selling agent ignored, the spirit and the laws of Victorian auctions sidelined – I suppose that makes it OK."

Valentic told Fairfax Media that he made two offers — $2,675,000 and $2,725,000 — but both were rejected after the auction. 

The house sold for $2,781,000.

A Consumer Affairs Victoria spokeswoman said the auction process was legally compliant.

"Frank Valentic’s first offer of $2,675,000 technically should have bought the property – yet he didn’t buy it," James noted.

Valentic was resigned to having been outdone by Jacobs.

“We had the money to buy that, we offered more than the reserve price," Valentic told the Herald Sun.

“But that’s The Block auctions. It’s a rollercoaster,” the veteran Block bidder said.

He had been bidding for a young upsizing family with two young children from Malvern East.

White it was "a very disappointing result for our clients" he managed to secure Hannah and Clint’s beautiful house for them for what he believed was the bargain of the auction finale at $2,615,000.

After the auction, Jacobs claimed due process was followed.

“Not unlike most auctions on the street where they pass in, there was a bit of confusion,” she said.

“Clearly I probably should have started bidding a little earlier but I was really waiting, because the other auctions had all stalled, for it to start again.”

Jonathan Chancellor

Jonathan Chancellor

Jonathan Chancellor is one of our authors. Jonathan has been writing about property since the early 1980s and is editor-at-large of Property Observer.

Tags: 
Consumer Affairs The Block

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