A real estate auction is a method of buying and selling real estate. It is an intense and accelerated real estate marketing process that involves the public sale of property through open, competitive bidding.

The auctioneer will submit the highest bidder to the seller in a reserve auction. The seller then has the right to accept or reject the bid.

Like real estate brokers, auctioneer’s charge a commission as a percentage of the sales price that is pre-determined. Sellers can choose between a traditional commission charge or the more modern method of a buyer’s premium, in which case the buyer pays the commission. In addition, the out-of-pocket expenses relating to marketing and promotion as well as conducting the auction are negotiated between the seller and the auctioneer.

After the seller accepts the bid, your deposit money will be deposited in an escrow account. If the bid is rejected, your check will not be deposited and will be returned to you.

Yes. The real estate auction marketing method has exposed the property to a large segment of the buying public. Many times, a buyer who wants the property but is uncomfortable with the auction process will make an offer after the auction date. In other instances, offers to buy the property prior to the auction date are made and accepted. Auction pressure forces buyers to act.

No. There is a significant difference between the experience and expertise of auction companies. In the past few years, the success of real estate auctions has led to many real estate companies trying to sell property at auction. Since you only get one chance to sell your property at auction, you need to choose a company that has a successful track record.

The seller sets the terms with the advice of the real estate auction company. Usual terms are that the high bidder deposits earnest money (either a percentage of the purchase price or a stated set amount) and enters a purchase contract immediately following the auction with the purchase price balance due usually within 30 days of the closing. The seller provides a clear title.

Properties generally sell “as is” with no warranties expressed or implied. Since the only issue left is price, due diligence is done in advance of the sale, such as preparing information packages and inspection reports.

Absolute means the property will be sold to the highest bidder. There are no minimums or reserves in an ‘absolute’ auction.

All our sales are on an “as is” basis. There are no warranties as to the condition and/or the fitness of the property for a particular use.

We encourage our buyers to do their due diligence prior to sale day for their own protection.

A well-conducted real estate auction, by its very nature, minimizes such failures. Failure to close can happen, but it isn’t frequent. If the rare failure to close occurs, the auction seller can turn to the next highest bidders, who demonstrated their willingness to pay nearly as much as the buyer who failed to close.

If the buyer fails to settle on the property, they will be considered in default of the sales contract. In this instance, the buyer will lose all or part of their deposit and potentially be responsible for the cost of reselling the property.

No, today, auctions don’t result from an individual’s repossessed properties. Rather, they are a result of the smart seller, who chooses the cost-effective, accelerated method of selling a property rather than laboring for months or years to sell it. This accelerated sale allows the seller to eliminate virtually all long-term carrying costs. These cost savings to the seller are passed along directly to the purchaser in reduced prices.

It is truly a win=win situation. Sellers can move on, and buyers can purchase properties at fair market value.

Contact our experienced auction professionals, and we will make an appointment to come and meet with you, view your property and make an auction evaluation. You may reach us at 800-342-2666 or by email at [email protected].