Not looking to sell through an agent or real estate company? Hate the lag of traditional home listings? There may just be another way! An alternative to traditional realty sales is auctioning. Many homeowners actually prefer auctions, especially if they're looking to sell quickly.
If you've decided an auction is right for selling your home, it's time to make a second decision: should it be online or in-person? Online auctions are through online auction platforms, while in-person auctions can be held on on-site or at a designated auction spot.
Want to learn more about auctions? You're in the right place! Auctions are an effective method of selling your home, and all property types can be sold via auction.
Selling via auction differs from other realty methods in that there's a time limit on selling. Auctioning is a fast and hassle-free way to sell a property without listing it, leaving the sale up to professional real estate auction companies who then vigorously market properties to garner public interest.
An auction signals to the buying community that you're committed to a quick sell, creating a sense of urgency in the minds of buyers especially for high-demand properties. However, selling via auction may be associated with distressed selling — a not-so-good thing. Moreover, homes with low interest may end up selling for a lower price than they would've on-market.
Homes sold via auction do come with some conditional factors. Typically, these factors benefit home sellers more than homebuyers. For one, houses can be sold "with reserve" or "absolute," the latter of which means no reserve. When a house is sold with reserve, it has an absolute minimum bid that a seller is willing to sell the home for, which means you're guaranteed at least that price should your home successfully sell at all. This price is determined beforehand, and the auction company is made aware of it in advance.
Auction-listing homes are sold as-is, which changes how they're interpreted by buyers. In normal home sales, homebuyers have the opportunity to negotiate various contingencies. For example, they might agree to a higher sale price if the bathroom is updated, or the home's facade is repaired. In auction situations, buyers cannot ask for additional work to be done nor can they add conditional statements. A house sold via auction has no appraisals, no inspections, and no mortgage financing. For all intents and purposes, what you see is what you get.
Traditional auctions may be on-site or in-rooms at a designated auction location. In-person auctions such as these may allow buyers to view the property before the sale. Traditional auctions have high energy levels, and they increase competitive tension between bidders. Traditional auctions may also offer an increased pool of buyers. You can expect some buyers who were outbid on their first-choice property to consider yours instead.
Traditional auctions offer one huge benefit: the agent and auctioneer have control over the day's variables. They can strategize the auction's order of sales for the highest probability of every home selling.
Online auctions are a more modern option, and often seen as more convenient by prospective purchasers. Buyers won't need to take time out of their busy schedules to attend an auction in a physical location and allow for bidding and payment on one convenient platform. Best of all, buyers enjoy the ability to learn more about a property before purchase through the auction platform via online auctions.
It is easier to acquire an auctioneer during an online auction, and an online auction may actually be cheaper for a homeowner to host. Like a traditional auction, online auctions can increase buyer numbers due to the bidding aspect. However, there is usually less hype than during a traditional auction due to the lack of in-person tension.
Now, selling via auction isn't all easy — it's still home selling after all! Some homeowners report being involved in the marketing, a job that would typically be covered by an agent's commission. There is also a different pool of buyers for auctioned homes. This is due to the method of selling and structure purchase terms.
Lastly, a lot of buyers assume auctions are only for distressed properties — think foreclosures, bank-owned homes, abandoned properties, and the like. If you are selling a distressed property, this is the best way to do it. If you're not, effective marketing is a must. Note to buyers that it's simply a property that needs to go quickly, not one that has underlying issues!
With that said, let's take a look at the biggest benefits of selling your home via auction.
Buyers' rush describes the energy of an auction where bidders get caught up in the moment. Auctions create tangible competition and a sense of urgency. This will play to people's emotions, especially in a good market. Bidders will not only spend more time in an auction environment, but they're also likely to spend more.
Selling fast and cheap? Auction away! Auctions often result in homes going for their true market value, which is a result of the competitive bidding process, while avoiding the lag of negotiating and high carrying costs. Buyers pay all estate commissions plus a non-refundable deposit. This can be notably beneficial during markets that seem to be taking a turn for the worse, allowing you to sell before your home's value drops.
There's nothing worse than believing your home has attracted interest only for every buyer to fall through. Auctions allow you to find serious buyers with a sense of urgency the first time around. They'll attract investors and house hunters because auctions are a hotspot for buyers trying to get into a competitive market or house flipping. Best of all, the nonrefundable deposits the highest bidders submit ensure a sale goes to settlement.
Listing your home means you have no idea when it will actually sell — which can be awfully stressful. Holding onto a property can be expensive, especially when paying double mortgages or rent simultaneously. Auctioning solves this problem by expediting the selling process, and most homes are sold within just 60 days. With an auction, you'll know the exact date of your sale — it’s when the auction is! Avoid high carrying costs, heightened taxes, and home maintenance for zen-like home selling.
During home auctions, experienced professionals handle all of the heavy liftings — even though you aren't assigned a real estate agent. An auction company will handle most of the marketing, promotion, and paperwork. Luckily, many auctioneers will run parallel processes for selling properties online and traditionally at the same time. Ask your auction agency if it's possible, and get the best of both worlds!
Deciding whether to auction? Not sure where to turn for an auctioneer? There's no need to feel lost during the home selling process. Taelah offers a human-assisted artificial intelligence system that tailors the realty process to your individual needs. Get in touch with top realtors at no commitment, and see what experts have to say about how to sell your home for the best price possible. Buying too? We've got that covered as well! Join today and see how easy it can be to buy, sell, and move homes.
For homeowners looking to sell non-traditionally, auctioning might just be the right route. Realty auctions can be held either in-person or online. Auctions signal that homeowners are committed to a quick sell and these houses are sold as-is. Some homeowners may choose traditional auctions for more competitive buying and better chances at a higher sales price, while others opt for online auctions due to their convenience and ease of use. While choosing between a physical auction versus an online one is a matter of preference, many auctioneers will happily run both forms of auction simultaneously!