The Agency cofounder will cut the asking price of 235 Oceano Drive by $100,000 each consecutive Monday following the auction’s launch, until the property sells. The auction style dates back to Holland’s 17th-century tulip trade.
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The Agency cofounder Billy Rose is trying a unique, but seasonally appropriate, marketing strategy with a $9.995 million listing the luxury broker is representing, he informed Inman.
Billy Rose | The Agency
In the spirit of the original auctions used in Holland’s spring tulip trade, Rose is pledging to cut the asking price of 235 Oceano Drive in Los Angeles by $100,000 each consecutive Monday following the auction’s launch on Thursday, until the property sells. The method creates urgency and transparency, Rose said, as well as a fresh take on pricing.
The term “Dutch auction” dates back to 17th-century Holland when the auction method was employed to create more effective sales in the competitive tulip market, according to Investopedia.
“Tulips needed to be sold the day they come to market, so they would just set a price and then go down, down, down until the market kind of found its level,” Rose said. “And this is a challenging market these days. Buyers and sellers — I’m in negotiations right now for like five different deals — and every buyer thinks they’re paying too much, every seller thinks they’re not getting enough, and a lot of that really is a tribute to the world, the fact that we’re in such a dynamic time where there’s systemic instability throughout the world and there’s just so many different factors that are giving rise to buyers not knowing, is now a good time to buy? Is now a good time to jump?”
“The idea here was, let’s bring attention to this listing, which is a great house, and give a buyer and a seller an opportunity to kind of find the right level of water, so to speak,” Rose continued.
The 7,346-square-foot home that Rose is representing is located in Brentwood and includes seven bedrooms and seven bathrooms. Built in 2012, the home was designed by architect Philip Vertoch and includes “abundant natural light,” according to the listing description. It also features an expansive living room with a fireplace and a bar, an outdoor living room, a formal dining room with vaulted ceiling, a library with a full bathroom, a private guest suite, a theater and a flex space that could serve as a gym or wine room.
The home has been on and off the market for a few months now. It was first listed in January for nearly $10.5 million, and about a month later, the price was cut to $9.995 million. It was taken off the market in February and then relisted at the end of March. Rose said when he came to his seller with the idea, he was open-minded because he wanted to show he was serious about selling and willing to negotiate with an interested buyer.
“This is a good way to bring attention to it and really get people aware of it [and] get them into the house, because the house sells itself,” Rose said.
The 30-year luxury real estate vet said that he felt the Dutch auction, which he referred to as “a reverse auction on a certain level,” was less intimidating for buyers. He introduced the concept on his Instagram Stories on Thursday.
“When you’re going in [an upward bidding] direction, you can often feel like you get emotionally engaged in a way that you have regret, because you’re often bidding against someone else and there’s kind of a win mentality,” Rose said. “And I think, oftentimes, buyers, they don’t want to participate in an auction. And this isn’t really an auction; this is basically an invitation to offers, making it enticing for someone, knowing that the seller is intending to take something less than the current listing price.”
Although the plan is to drop the price on consecutive Mondays, Rose clarified that, of course, any buyer is free to make an offer of a lower price earlier than the scheduled price drop at any time.
Rose has actually tested out the method before on a previous listing, although at the time, he was unfamiliar with the term “Dutch auction” — his current seller educated him on the term’s history. He said the previous time he used the strategy, it resulted in a successful sale after three rounds of price cuts.
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