Blog

 

Real Estate Auction FloridaAuctions are a great way to market and sell real property and other assets in a pre-determined amount of time.

 

In “traditional” real estate marketing, a seller agrees to list a property with a broker who in turn lists the property on the local multiple listing service (MLS) and places a sign in the front yard. The broker may send out a direct mail campaign or email blast and wait for buyers and buyer’s agents to call.

 

In most cases the broker or agent will market the property to a specific and local geographic area. They rely on buyer’s agents to bring any prospective buyers from outside the market area.

 

Using the auction method of marketing, specifically an online auction, we
showcase your property worldwide. We utilize the local MLS, targeted local advertising AND a high traffic, worldwide auction platform to showcase your property to thousands of potential buyers.

What’s the time period for and auction listing?

A traditional real estate listing, at least here in the state of Florida, is typically 3 to 6 months,

Traditional listings expire quietly in the night and auctions close publicly and competitively!

 the latter being most common. If the property doesn’t sell the listing expires.

 

In an auction situation, your property will be showcased online for a period of 30-90 days, depending on your needs. The big difference is that there isn’t an “expiration date” there is a specific date and time where the auction will close. This is where the virtual auctioneer drops the hammer and yells “sold!”.

 

Having a specific day and time that the auction closes creates a sense of urgency for potential buyers to bid, compete and own the property. When the auction is over- IT’S OVER! Most of the time in an auction, someone, maybe a competing bidder will win and be under contract to purchase the property.

 

Traditional listings expire quietly in the night and auctions close publicly and competitively!

 

So, an auction listing is sold “as-is”. What does that mean?

 

One of the benefits of selling your property in an online auction format is that it is sold “as is”. A potential buyer agrees prior to bidding that they will accept the property in its current condition without requiring the seller to make repairs etc.

 

A buyer may chose to pay for an inspection prior to the sale. This would be for their benefit and not to require the seller to make changes to the property.

 

 Do buyers have to have cash to bid?

 

Most auction sales are all cash deals. Potential buyers are also required to secure their own financing prior to bidding. To be a qualified bidder, they must demonstrate that they can close with no contingencies within 30 days of the auction.

 

We do our best to qualify a potential bidder prior to the auction. We require that they document their ability to pay for the property. We also require a sizable deposit to insure that the property will close within 30 days.

 

 

What about costs and commissions?

 

In the “traditional” method of real estate sales, the seller is responsible for paying the broker’s commission out of the proceeds of the sale- or in some cases out of their pocket! A typical commission here in the North Florida area is between 5-10% with 7% being the most common. The seller is usually responsible for some of the closing costs and carrying costs that are associated with a listing being on the market for an extended period of time.

 

In selling your property in an online auction, the buyer pays the “commission” in the form of a “buyer’s premium” at closing. The seller is not charged a commission unless there is a substantial and legitimate offer made on the property prior to the close of the auction.

 

If an acceptable offer is made by a qualified buyer, prior to the auction close and the seller accepts the offer, we would negotiate an acceptable commission. In both situations a seller would be responsible for some of the closing costs. Documentary stamps, title insurance etc. are typical.

 

Are there any other fees paid by the seller?

 

Some of the online bidding platforms require a listing fee. This listing fee would generally be paid by

Auctions create competition in the marketplace. They entice buyers to bid and drive the price up, not to negotiate a price downward!

 the seller prior to listing their property as an online auction.

 

In some cases, a seller may opt to purchase a marketing package from the auctioneer to cover additional advertising and marketing. This would usually include targeted social media ads, direct mail pieces, custom signage etc.

 

 

What if the bidding doesn’t reach the amount needed for the seller to be able to sell the property?

 

We offer the seller a “right of refusal”. If the high bid is less than the seller requires to sell the parcel, we would negotiate with the bidder or possibly the next highest bidder, to get an acceptable offer for the property. The seller retains the right to refuse any offers or bids.

 

 

The auction method of marketing may not be the right method to market and sell every home, or parcel of real estate but in many situations it is best. An auction listing has the potential to stand out among all of the other pieces of real estate tat are offered for sale in a particular area. When selling anything- especially on the internet, the offering has to be unique and “cut through the noise”. Auction listings have that ability to be different and attractive to potential buyers.

 

Here’s another great point; your property may sell before the auction closes.

 

There is a huge possibility that a buyer may offer to purchase the property before the auction even occurs. We make it possible for you to accept and reject offers at any time while we market your listing.

 

We are very aggressive in our marketing and methods of showcasing your property. It is a distinct possibility that an acceptable offer will be delivered prior to the auction as a result of our marketing efforts. goal is to sell your property for the highest possible amount. Sometimes an online auction portal is where an interested party will discover your listing and decide to buy.

 

Urgency is key-

 

Remember, auctions create urgency. Auctions create competition in the marketplace. They entice buyers to bid and drive the price up, not to negotiate a price downward!

Is an online auction right for your property? Maybe- maybe not. We would live to discuss it with you, complete a market analysis on your property and listen to your specific needs and determine if it would be beneficial.