Imagine this scenario. On a sunny afternoon in Bel Air, an energetic crowd gathers on the vast grounds of a high-end luxury estate. A loud and eager banter between an auctioneer, a group of bidders and bidder’s assistants fill the air.
For several minutes the auctioneer asks for the next highest bid, and the bidders respond enthusiastically. All of a sudden, the bidders became silent. The most senior bidder holds his breath in anticipation of winning the auction. The auctioneer calls for one more bid but gets no response. In a loud and clear voice, he hollers to the audience, “fair warning, last chance!”. The auctioneer pauses for a moment then exclaims, “this luxury estate has just been sold to the highest bidder!”.
In less than 10 minutes, another multimillion-dollar estate has changed hands. Successful real estate auctions like the one described above are happening all over North America and the Caribbean islands.
houses for sale in calabasas auctions have been steadily on the rise. Growing inventories and fading buyer confidence have partly driven Their increasing popularity.
Properties that could usually sell in weeks using traditional methods are now languishing on the market. Unable to attract buyers even as sellers have significantly lowered their prices. Many people have been saying that the real estate boom is over, but savvy buyers and sellers have been raking in the profits from real estate auctions.
Real estate auctions work in up or down markets, without regards to trends or market cycles. Real estate auctions provide an open and transparent process for buyers and sellers.
Adequately conducted real estate auctions attract ready and willing buyers and motivate them to act immediately. The auction method removes the “wait and see” attitude which only serve to depress real estate values further. Buyers are always concerned about overpaying. With auctions, they can see what others are willing to pay.
When market demand is high, and inventories are low, real estate auctions can deliver selling prices well above what a seller would get during private negotiations. In a hot seller’s market, many property owners use traditional real estate methods.
They negotiate with one buyer at a time. Leaving thousands of dollars of equity on the table. During up markets, real estate auctions are the best way to establish the top market price.
Evaluating Your Real Estate for Auction
Not every property or seller is a good candidate for auctions. First of all, sellers must be ready to sell now for the current market value. A real estate auction will not fix problems caused by a decrease in the market value of your property. If you owe more than what a willing buyer would pay for your property, be prepared to come to closing with your checkbook.
Properties that do well in real estate auctions have a high uniqueness factor. Ask yourself, what makes my feature different from other properties on the market? Maybe, you own a resort property or a high-end luxury home. Commercial properties and land do very well at auctions for they thrive on uniqueness.
If your property is just like everyone else, the best thing you can do is offer the most competitive price. More importantly, sellers must be reasonable about setting a minimum bid.
A seller must look at the lowest and most current comps. Price their property slightly more economical to generate the interest and urgency necessary for a successful real estate auction.
Once the auction begins and qualified bidders start competing against each other, you can sit back and enjoy as a bidding war ensues.
Locate a Qualified Real Estate Auctioneer
Start by checking with the National Auctioneers Association. The best real estate auctioneers belong to this organization. These real estate auctioneers are well trained and adhere to a standard and observe a strict code of ethics.
Many realtors attend the annual International Auctioneers Conference where the latest techniques and innovations in the real estate auction industry are presented. Find out if the company you’re considering is a full-time real estate auction firm.
Many real estate agents are getting auction licenses yet have no experience with the auction method of marketing. Conducting a successful real estate auction is nothing like a traditional real estate deal. Decide to go with a real estate auction pro.