Cardel Homes raised eyebrows earlier this month when it notified subscribers to its email distribution list that three of its homes would be offered for sale via online bidding.
Cardel was introducing two things: Is there an appetite for buying a new-build home completely online, with minimal human interaction; and would buyers purchase in a blind bid, with a minimum purchase price?
Certainly, the idea of bidding on a home is not new — at least in the resale market. For the past few years, Ottawa has been caught in a storm of multiple bids driving up prices as too many buyers scramble for too few homes available for sale. Just last week, there was the example of a two-storey home in Riverside South that sold for more than $400,000 over asking price.
But while bidding is common and accepted in the resale market, it was fresh territory for new-build homes, which are typically sold at a set price.
So, how did Cardel’s online bidding experiment go?
So far so good, although Cardel is still assessing the online transaction process. There were about 15-18 offers that came in, says Tanya Buckley, Cardel’s vice-president of sales and marketing, and there were multiple offers on each home. She would not disclose what the winning bids were.
“We’re not prepared to walk away from our traditional way of selling,” notes Greg Graham, Cardel’s chief operating officer and president of the company’s Ottawa operation. “But we’re prepared to explore new ways of selling, because in five years, what does our industry look like? In 10 years? There’s disruptive technology, 3D printing’s coming, panelization’s huge, container homes are getting a great big push.”
Adds Buckley: “Change is coming… and those who resist it will fall behind. Those who explore it and keep up to it will thrive.”
Graham says there’s been both positive and negative feedback, and he welcomes both.
“You can’t change perceptions, but you can learn from them,” he says. “Sure, people have gone on social media and crucified us, but sit down and have a conversation with us and let’s walk this through and what is your problem with it? And I think the problem is no one’s ever done this before and we’re doing it in probably one of the hottest economies.”
Interestingly, on the heels of Cardel’s experiment, Mattamy Homes sent out its own email notice March 22 announcing that one of its model homes at Blackstone would be sold via bidding.
The two-storey townhome includes several upgrades and a fully finished basement. The minimum bid is $679,990 and offers are due by March 28.
Mattamy declined to comment.