As real estate auctions rise in popularity across the nation, we see many property owners turning to the auction method to sell their own properties.
Auctions offer owners an innovative and effective method of selling their property - they offer an intense, accelerated real estate sale process and eliminate the traditional long-term carrying costs, such as taxes, insurance, utilities, etc.
Then and Now
“15 years ago we were doing ten to twenty real estate auctions a month,” Braden McCurdy, Real Estate Broker at McCurdy Auction LLC said. “Now we are auctioning 30 to 75 properties a month. 2017 is concluding and we are on track for 600 auctions this year.”
Last December, Rick Sharga, executive vice president of Auction.com, told The Wall Street Journal there has been a 120 percent increase in the number of properties sold through auctions compared with five years ago.
Auctions are a great alternative for some sellers simply because it puts them in control of the sale. Sellers are able to choose the date of the sale, the minimum price your property will sell for and exposes the property to a large number of pre-qualified prospects.
Bottom line is you are making the buyers compete for your property; not waiting around hoping for a good offer.
Seller Auction Benefits (according to REALTOR.com):
- Buyers come prepared to buy.
- Quick disposal reduces long-term carrying costs, including taxes & maintenance.
- Assurance that property will be sold at true market value.
- Exposes the property to a large number of pre-qualified prospects.
- Accelerates the sale.
- Creates competition among buyers-auction price can exceed the price of a negotiated sale.
- Requires potential buyers to pre-qualify for financing.
- The seller knows exactly when the property will sell.
- Eliminates inconvenient and impromptu showings.
- Takes the seller out of the negotiation process.
- Ensures an aggressive marketing program that increases interest, visibility, and competition.
The majority of auctions today don’t result from foreclosure or distress situations, but rather are the result of a seller choosing a cost-effective, accelerated method to sell their property.
No longer does an auction mean that the seller is in financial trouble. Today the majority of our real estate auctions are free and clear properties with Sellers that simply want a timely and contingency free sales process. One of the largest growing sectors of our business is from Sellers downsizing and looking for transitions in their housing needs.
Buyer Auction Benefits (according to REALTOR.com):
- Smart investments, as properties are usually purchased at the fair market value through competitive bidding.
- The buyer knows the seller is committed to selling.
- In multi-property auctions the buyer sees many offerings in the same place at the same time.
- Buyers determine the purchase price.
- Auctions eliminate long negotiation periods.
- Auctions reduce time to purchase property.
- Purchasing and closing dates are known.
- Buyers know they are competing fairly and on the same terms as all other buyers.
- Buyers receive comprehensive information on property via property information packet.
So are real estate auctions the future of home buying? It’s still too early to tell, but auctions do offer a lot of advantages to all parties. They’re a fast, fun, easy and transparent process. And at the end of the day – whether you’re a buyer or seller you stay in control. And that’s a pretty good feeling.