Auctions have many advantages for the seller over conventional listing methods.
Real estate auctions offer many advantages in today’s market. Sellers typically prefer not to wait months or even years to receive an acceptable offer on their property. As a seller, you ideally want an offer as quickly as possible to turn a page in life and to move on. The auction method of sale is the only suitable choice for that situation. Selling real estate by auction is perfect for sellers who need to sell quickly but receive market value. The auction method of marketing is extremely important to establish market price on unique or large properties with a very small pool of potential buyers. To put it simply, a real estate auction establishes true market value of a specific property in a specific marketplace on a specific day.
The benefits of real estate auction greatly outweigh the mainstream listing method in many cases.
Put the Markets Focus on YOUR Property – An auction showcases your property to the marketplace, providing maximum visibility to the target market. Potential buyers must decide on your property first as it is date certain and will not be on the market past the auction date. In a conventional sale environment, your property will just be one of many (currently over 20,000 on our local system) that are minimally advertised in the Multiple Listing Service (MLS). At Alliance we belong to four of the major MLS systems in Texas. We place your auction on each system to notify all real estate professionals that your property will be sold at auction and invite them to register their buyers.
Lightening Fast Market Price – Real estate auctions offer a marketing timeline for a residential property of 30 days, a large ranch takes 60 to 90 days. Mainstream listing methods typically take months for single family homes and years for large ranches. Real estate auctions compress the marketing timeline and notify all potential buyers that auction day is the day to buy.
“Real Estate Auctions take the control away from the buyer and gives it back to the seller”
The Sky is The Limit – An auction does not have a ceiling when it comes to price. I doubt any auctioneer in World History has ever said “I’m stopping the bidding, it’s too high.” Auctions allow the market to speak for itself, that’s why world record prices are established at auction not by seller pricing. Conventional listing methods allow the highest possible price to be capped by the seller´s asking price.
Contingencies? We Don’t Need No Stinkin’ Contingencies – Properties offered at auction are sold “as-is”. This means the high bidder cannot back-out of the auction purchase contract without risking their escrow money because of inspections or lack of financing. Experts have estimated conventional sales have a fallout rate as high as 50% because of contingencies. This wears on the seller’s emotions and lengthens the time it will take to sell their property even more.
No Negotiation Zone – The auction method of marketing real estate pits buyer against buyer. This allows the seller to sit back and enjoy the escalation of price since the terms and conditions of the sale were established by the seller prior to the auction. Conventional sales processes pit the buyer and seller against each other causing an anxiety-ridden back and forth, sometimes for days or weeks. Many times, this results in strained relations between the buyer and seller even after negotiations have been settled.
True Market Value, NOW – Markets ebb and flow faster and more often than ever before in World History. Real estate values can drop dramatically over the span of a 6 or 12 month listing agreement. When you are ready to sell, real estate auctions provide the catalyst to determine the true market value of your property within 60-90 days. All too often the conventional listing process starts out with overpricing a property immediately killing the interest of potential and serious buyers. At an auction, the fair market value of a property is established and goes up from there.
Timing, It’s Everything – Real estate auctions allow the seller to control the marketing process on their chosen timeline. Conventional sales methods guarantee that sellers will play the waiting game. Sellers will wait on buyers to show interest, wait on them to come see your property, wait on them to make an offer, wait on them to accept your counter offer and wait on the option period to expire. But with an auction you have more control. Auctions are the fastest way to seriously move real estate because much of the waiting is simply eliminated.
Offers, Let’s Get a Bushel Basket of ‘em – In a conventional listing you rarely get multiple offers. If you do it is likely a good sign that you are under-priced. Typically, you can expect a painstaking process of waiting for an acceptable offer from a qualified buyer. Industry experts predict the average listing gets nearly three offers before an acceptable offer is made, but those offers are not at the same time. With an auction, you will get many offers presented on auction day until the highest and best offer is determined by the auctioneer. That’s the only one you wanted when you decided to sell.
Don´t waste time on often ineffective conventional listing process. Selling real estate by auction is the new way to get it done.