How a Real Estate Auction Benefits the Buyer AND the Seller
Real estate auctions are one of the best ways that you can buy or sell property! They are quick and painless and allow both the buyer and the seller to get a great deal for their assets. In a real estate auction, a seller works with an auction house to sell their home or other piece of property to a pool of bidders. While it may seem like only one party (either the bidder or the seller) will gain the most from the auction depending on the property, real estate auctions provide many benefits to both the buyer and the seller!
Benefits for the Seller:
1. Very little work on the seller’s end
In a traditional real estate sale, the seller generally feels a lot of pressure to keep up with the realtor throughout the process, will find themselves worrying about the offers that they receive. Not to mention having to deal with negotiations surrounding the condition of the property. Not so with a real estate auction! An auction house will take care of everything for the seller, making sure that everything is under control so that the seller can just sit back and wait for the bids to come.
2. It is a fast process
Traditional real estate sales can be a long drawn out process. Between home showings, realtor meetings, and buyer meetings, the time frame can vary drastically. However, in an auction, there is typically only a short period of time from when they contact an auction house to when the house is sold. This is great when a seller needs to sell fast – or when you just don’t want to have to hold onto a unwanted property longer than you have to.
3. Property is Sold As-Is
When conducting a traditional real estate sale, a buyer will often request that the seller fix different aspects of the house in order to receive their offer. This can drag a seller into a wide variety of costs that they weren’t planning on, as well as creating a hassle for them as they deal with contractors, inspectors and the potential buyer. In an auction, the home is sold as-is, which eliminates all those complications, allowing the process to be easier and much faster than it might otherwise be.
4. You don’t have to worry about showings
When selling property in an auction there will typically be only a few inspection times (that you will know in advance) that you can easily work your schedule around, so that potential buyers can come to look at your property. This is a lot easier than having to constantly reorganize your schedule as different buyers come to look at your home in a traditional real estate sale.
5. You know the timeline
Like we said, a traditional real estate auction can be a drawn-out process lasting many, many months. This is often draining as a seller must deal with the ins and outs of the sale, as well as keeping up payments for both their new home as well as the property they are trying to sell! With an auction, a seller knows the day and time that their property will be sold to whoever the highest bidder ends up being, allowing them to rest easy.
6. Auctions reach a wide range of bidders
When selling through an auction house your property is presented to hundreds of bidders that are interested in buying property. Your auction will reach a larger demographic of people interested in buying and lets you gain a large audience quickly instead of waiting for individuals to find your property.
7. You will receive the true market value for your property
Because you have bidders bidding against each other to determine the final price of your property, you are able to determine the true market value and get a higher amount than you may expected to receive in a general sale. Plus, you don’t have to worry about negotiations – the bidders will take care of that for you!
Benefits for the Buyer:
1. It is a fast process
Buyers want to get through the buying process just as much as the seller wants to get through the selling process! Real estate auctions allow you to buy property quickly – you could even buy a piece of property in a single day if you choose not to attend an inspection (but you should probably go to one). Online auctions let you see a property, decide if you’re interested, and close the deal as soon as the auction ends without any fuss.
2. You Determine What You Pay
While you would know what you would be paying in a traditional real estate sale, you will have an even better understanding of what you will be paying in an auction. You don’t have to worry about negotiations with the seller, you can pick your maximum price and stick to it with the understanding that you won’t have to bend to the will of the seller. You might go back and forth in a bidding war with another bidder, which will raise the price, but you can always choose to drop out. Auctions also give you the transparency of what other people are offering to pay that you wouldn’t receive in a traditional sale. If you know the bid increment, you won’t have to worry if you’ve put in a lower offer than someone else. Everyone always knows who has the highest bid as well as what it is, allowing you to evaluate what you are willing to pay.
3. You know when the sale closes
The buying process can drag on and on in a traditional sale, but with an auction it is easy to know when the process will be over. You know the start and end date of the auction and will know the results as soon as the auction has closed. Plain and simple. It’s also reassuring to know that when the auction has closed the sale is over. Since the seller has agreed to sell to the highest bidder, they cannot accept another offer after picking you, which is not guaranteed in a traditional real estate sale.
4. You will pay true market value
Because the final bidding price will be dictated purely by what you and your fellow bidders are bidding, the true value of the property will be reflected in the price. You will be able to leave the auction knowing that you got the best deal you could on the home, commercial property or land. Many times, you will pay a lower price than what the seller would have asked because the market will have dictated a lower value for the property. This is a fantastic way to get either a home or land for an affordable price!
Real estate auctions are incredibly beneficial for both the buyer and the seller. Between the speed and ease of sale, it is surprising that more people don’t opt to buy and sell property through auctions. If you have any questions surrounding the benefits of buying or selling real estate at an auction, or if you have property that you are looking to sell, contact us here. If you’re looking for your next dream home or property, click here to go to our current auction listings – you never know what you might find!