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Buying and Selling
REAL ESTATE AUCTION MARKETING ADVANTAGE
Seller Benefits
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Never has to worry about selling too cheap
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Offers the seller another option
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Creates competition among buyers; auction price can exceed the price of a negotiated sale
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An auction generates excitement and heightens buyer interest
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Exposes the property to a large number of pre-qualified prospects
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Requires that potential buyers pre-qualify for loans
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Property is sold as is, where is and how is without contingencies
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Accelerates sales; the property can sometimes be sold within three weeks of listing
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Eliminates high seller carrying costs; (such as interest, taxes, maintenance)
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Auction brings interested buyers to a point of decision; they must act now or lose an opportunity to purchase
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Auction is a true market forum; the highest buyer pays the lowest price a seller will accept
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A seller knows exactly when the property will sell
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A seller sets the terms and conditions of the sale, maintains control of the property throughout the auction (depending on auction type), and actively participates in the sale process
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Reduce the time the property is on the market
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Eliminate numerous and unscheduled showings
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Take the seller out of the negotiation process
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Is an aggressive, advance marketing program that increases potential interest in and awareness of a property
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The seller is able to obtain liquidity
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The seller is able to move on to other investments and free up capital
Buyer Benefits
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Purchase property at fair market value
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Never has to worry about paying too much
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Eliminate sometimes long negotiation periods
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Reduce time to purchase property
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Gain confidence as they compete
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Do not have to worry about contingencies because purchasing and closing dates are known
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Feel better about a purchase; just knowing there is a contending bid just one increment under purchase price
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Buyers know property owners are motivated to sell
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Buyers know property owners sell at lowest price possible
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Buyers can receive favorable financing
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Buyers set their own purchase price
FFundraising auctions are a great idea to make some serious money, get recognized by news publications and because everybody has a common goal - to make money for a cause.
With the right atmosphere, the excitement generated will insure your audience has a good time. This will will help to create a successful auction which gets better every year. Why?It's simple, anybody can create an annual or semi-annual event such as schools, Rotary, private clubs, equestrian clubs, hunting clubs, non-profits, Christian schools, sports clubs and others that have used us have fun. Making more money year after year.
Costs
Costs are flexible and varies depending on the amount of work requested.
First time auction may require multiple meetings to discuss the catalog, promotion, sources of donations, site layout, staffing, raffles, silent auction, cashiering and other miscellaneous requirements.
If your organization has been through this process and requires limited assistance, then costs are negotiated.
Next Step
1. Attend your next committee meeting with the information needed!
Contact us with basic details on your auction. We will then give you a cost estimate and details to discuss at your next meeting. We will also provide you with a fund raising checklist to create a smooth process.
Once your meeting is complete, contact us with any more questions.
2. Lets confirm a date and have an auction.
The Buyer's Premium is one of the greatest
things that has come about in the auction
profession. After using me Buyers Premium
exclusively on every auction we have
conducted in the last year. I cannot see any
difference in the bidding participation except
in the small items less than $10. There
seems to be more complaints from the
buyers from items $50 and less than from the
high-ticket buyers, such as real estate
customers,
By using the Buyer's Premium, the seller has
more flexibility to pay advertising cost,
clean-up, and survey, in the case of a real
estate auction, and any other costs that in
many cases the owner or auctioneer
normally absorbs. The sellers feel more at
ease when he/she is only paying auction
expense rather than commission and
auction expense; and the auctioneer can
take home more money from the auction
when the Buyer's Premium is used. It’s a win, win.
Buyers adjust quickly. Using a 10 percent
buyers premium, or any amount your
company is comfortable with working with.
This set amount should be consistent; and,
therefore, considered part of the deal.
When using the Buyer`s Premium, we place the
premium amount in all advertisements,
brochures, newspaper ads, and place a sign
at the registration desk on the auction site.
We always announce that there is a Buyers
Premium to be added to the winning bid
price, so you will have a taped statement on
record along with the terms and
of the auction.
Clerks must be very well trained and have a
lot of patience because they are the ones
that get the "Heat'. Buyers are usually alright
when we tell them the
Buyers Premium helps pay some of the
sellers cost and is very much like 'Taxes'
we just add the Buyers Premium to the bid
price to make a contract price.
The auctioneer that uses a Buyers Prenium
has a competitive edge on the competition _
by not having to get the mortgage amount
plus a commission. Instead, once they
reach the mortgage amount, the
commission is built into the Buyers
Premium, which is just added on.
There are two schools of thought regarding
the use of written reserves for the sale of
real estate at auction-
Most auctioneers believe the reserve should
be written into the listing contract. On the
other hand , l have heard some auctioneers
argue that the reserve should not be written
but merely agreed upon verbally between
the auctioneer and the seller.
The reasoning here is that a reserve is often
too high in terms of the market value of the
property, and writing down this tigure
solidifies this inflated amount in the seller’s
mind. lf it's not written down — those who
believe in not having a written reserve
reason — it is easier for a seller to accept a
lesser amount.
There is something to be said for this
approach. On the other hand, I have not
found it uncommon for sellers to accept
significantly less than the written reserve. In
fact, I have seen sellers accept a high bid
that was barely half of the written reserve.
l believe it is best to have the reserve in
writing.
One danger with an unwritten reserve is that
since it is not in writing, it is not enforceable
~ in accordance with contract law.
Because an unwritten reserve is
unenforceable, the seller can change his
mind upward the day 0f the auction; that is,
decide he or she wants more than the
reserve. This can easily happen if a num ber
of heirs are involved, and the executor or
executrix or the attomey - yes, the attorney!
- does not inform all parties of what the
reserve is.
This very thing happened recently to an
auctioneer who offered a piece of real estate
at auction, received a high bid that was in
excess of the appraised value Bid above the
reserve, yet the sellers - several heirs —
refused the offer. The auctioneer had done
his job, yet did not get paid!
ln most real estate listing contracts an agent
is due a commission if he receives a bonafide
offer at the price stated as acceptable
to the seller in the listing contract. whether
the seller agrees to accept the offer or not.
Consult a real estate attorney for the proper
language to use-
Whether you enforce a clause calling for the
seller to pay a commission if you receive a
bona fide bid at the level of thereserve will
depend on your relationship with the seller
and the circumstances - but it is wise to
protect yourself with a written reserve.
It keeps the seller honest.
We can handle selling about anything for you on consignement. If you would like to have a Real Estate Auction we can create a marketing budget that will help to ensure you get top dollar from buyers in the market. With support from our broker our combined experience of over 30 years will ensure your Real Estate Auction is managed properly and legally. There are many approaches to selling your property creatively. Several different ways include Absolute Auctions "provides the perception of a bargain" Multi-parcel "creates bidder competition" or have a standard auction with reserve.
