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Real Estate Auctions: The Basics & Benefits
Looking for information about real estate auctions? Read this entry and search for others! Included in this entry:
What is a Real Estate Auction?
How will auction benefit me?
Benefits to the Seller, Buyer and Real Estate Agent/Broker
Q. What is a Real Estate Auction
A. A real estate auction is an innovative and effective method of selling real estate. It is an intense, accelerated real estate marketing process that involves the public sale of any property -- most certainly including thosee that are nondistressed -- through open cry, competitive bidding.
Q. How will auction benefit me?
A. The real estate auction is a win-win proposition for everyone involved.
Benefits to the Seller:
- Buyers come prepared to buy
- Quick disposal reduces long-term carrying costs, including taxes & maintenance
- Assurance that property will be sold at true market value
- Exposes the property to a large number of pre-qualified prospects
- Accelerates the sale
- Creates competition among buyers -- auction price can exceed the price of a negotiated sale
- Requires potential buyers to pre-qualify for financing
- The seller knows exactly when the property will sell
- Eliminates numerous and unscheduled showings
- Takes the seller out of the negotiation process
- Ensures an aggressive marketing program that increases interest and visibility
Benefits to the Buyer:
- Smart investments are made as properties are usually purchased at fair market value through competitive bidding
- The buyer knows the seller is committed to sell
- In multi-property auctions the buyer sees many offerings in the same place at the same time
- Buyers determine the purchase price
- Auctions eliminate long negotiation periods
- Auctions reduce time to purchase property
- Purchasing and closing dates are known
- Buyers know they are competing fairly and on the same terms as all other buyers
- Buyers receive comprehensive information on property via due diligence packet
Benefits to the REALTOR®
- Generates a list of ready, qualified buyers
- Offers clients and customers new selling and purchasing options
- Increases revenue and market share
- Develops your own market niche
- Assurance that property will be sold at true market value
- Property is sold within a relatively short period of time
- Exposes the property to many potential purchasers
- Auctions bring people in to look at all your listings, not just the auciton listing
- Successful auctions result in referrals and return business
- Agents can earn commissions as referring agent/broker, cooperating agent/broker, or as the listing agent/broker
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