Real Estate Advantages
according to the National Association of Realtors (NAR).
Auctions VS. Traditional Sales:
The Speed of the Process
Once you agree to proceed with an auction, your property will be sold in six to eight weeks, instead of the six to eighteen months and longer typical of other selling methods. Mortgage and holding costs are minimized and you can confidently plan and make commitments with the knowledge that your property will be sold for the highest market price available on a certain date. Reserve auctions with realistic minimums can deliver the same benefit.
Unlimited Ceiling
The most important element of the auction process is Competitive Bidding. An auction brings buyers together at one time and place to compete with each other until one bidder emerges victorious. Since everyone in attendance expects that the property will be sold, competition and a sense of urgency are created which can send the price beyond expectations. This excitement doesn’t exist when selling via traditional methods.
No Buyer/Seller Negotiation
Other selling methods put the buyer in control of the process, starting with an offer. Then comes the further negotiations after inspections. Additionally, traditional contracts typically create no urgency to close. An auction is an AS-IS sale with NO CONTINGENCIES. Once the hammer falls, the deal is typically done.
No Contingencies
All auction properties are sold in “as is, where is” condition. Potential buyers are given ample time to inspect properties prior to auction. Terms and conditions are preset and non-negotiable.
Pre-Qualified Buyers
Potential buyers must be prepared to tender a large, non-refundable down payment on auction day, usually in the amount of five to ten percent of the anticipated sales price. The high bidder signs contracts immediately after the high bid is declared. The closing date usually occurs within 30 days.
Types of Auctions
As a Seller, you have a choice to make in the way that the property is sold.
Absolute Auction
As a general rule, an Absolute auction or “auction without reserve” will generate the greatest interest among potential buyers. The result is greater attendance at the auction more competitive bidding which sends the final price higher. An Absolute Auction means exactly what its name implies; the property will sell regardless of the amount bid. While on the front end this seems scary to many new sellers at auction, old pros will tell you that this is always the best way to ensure the highest price will be achieved. Think of it as a buyer - would you spend your time and effort to investigate a property if you weren’t sure it was going to be sold?
Reserve Auction
Reserve auctions all a seller to establish a reserve price below which they have the right to accept or decline the highest bid. Once the reserve is met, the property must then sell. We will assist the seller in choosing a proper reserve amount. We do not accept properties with unrealistic reserve prices. Properties will only be selected for auction if the seller is dedicated to selling the property. Sellers may accept a bid below the reserve if they choose and they often will if the offer is reasonable. Reserve auctions are useful in situations where liens exist against the property.