Q2 Mortgage Filings Down 31%
May Commercial Sales Drop 75 Percent
Sales Drop 50% Despite Builders’ Best Efforts
January Home Sales
Real Estate Auctions Thrive
2007 New Home Sales
Schnuck's pay $3M for property
Company to auction 100 foreclosed Memphis homes
Auctions gather steam as first option for home sellers
NAR Report: New-home sales recovery unlikely before 2009
Message is Clear: Buy Houses Now (from The Daily News)
New Kid on Block
Auction industry experiences extensive growth for 2006
Charity Auction Raises $83,000
Frequently Asked Questions
SELLERS
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 those that
are non-distressed - through open cry, competitive bidding.
Q. Why should I sell my property using the auction method?
A. There are many advantages for sellers that are "built into" the
auction process, but the number one reason is the speed of the marketing
process. Besides the ability to sell your property quickly, you receive a
fair market, no-contingency contract and it usually closes in 30-days.
Q. What types of assets do you auction?
A. Primarily real estate. We will offer to sell equipment if the real
estate is being sold as well. We auction all types of real estate from
condominiums, single-family homes, land (agricultural and timber), commercial
& investment properties, and high-end trophy properties.
Q. My Listing Broker has had no previous experience with auctions. Will this
impact my results?
A. No. Our auction staff is composed of a group of specialists that deal with
this situation daily. We will work with your broker throughout the entire
process. Ultimately the Auctioneer manages the auction process and the broker
gets paid without having much to do with the process.
Q. Do I have to sell my property to the highest bidder?
A. The best way to sell is to auction the property "absolute". This
guarantees to the market that you are going to sell and this creates a much
greater interest in any potential buyer in the market. It attracts
purchasers from the broadest geographic region because buyers can justify their
time and efforts to inspect, bid, and buy, knowing there is no question the
property will be sold. You may also choose the reserve method which is a
secretive price between the seller and the auctioneer that the seller will not
sell below. The seller has the option to accept any bid at the auction,
whether it meets the reserve or not. However, a reserve will keep some
bidders from attending and performing the necessary due diligence to buy the
property. The decision to sell absolute or reserve should be discussed in
detail with your sales associate or auctioneer.
Q. How is the property marketed?
A. A detailed marketing plan is developed by the Auctioneer and is presented to
the seller for approval. Generally, the marketing plan includes direct mail,
local, regional and targeted print advertisements such as newspapers, the
website, and other marketing avenues that may include radio and / or television.
Q. Does "As Is" mean I don't need to disclose any known defects?
A. There is no seller's disclosure form for you to fill out, however, if there
are any blatant defects, ethically we must disclose these to potential
buyers. This does not include normal wear and tear items nor any problems
that occur after the closing.
Q. What if the property is priced below the market right now?
A. Often times we find that the price is not the reason why a property doesn't
sell. The primary cause often is it has not been marketed effectively and,
therefore, the property has experienced insufficient exposure. In other words,
it has become "stale''. The auction process is the best way to revive
interest in the property create the urgency in the marketplace and obtain offers
at current market value.
Q. I am not in financial trouble, should I be concerned about what people
might think if I hold an auction?
A. You are not alone in your concerns. Many people are afraid of the old,
outdated perception of auctions some people have. There are great differences in
the marketing of a voluntary, "by choice" auction such as ours versus
a distress auction. Our auctions are positive, enthusiastic events designed to
generate competitive bidding, providing immediate results for both seller and
buyer.
Q. I am concerned about the net amount I'll receive from the auction because
I have a mortgage. What advice do you have to offer on this?
A. This is part of the interview process during our first meeting. Please
keep in mind that we will be your agents and will have a fiduciary
responsibility to represent your best interest. A part of that process is
to help you decide if the auction process is best for you. We understand your
concerns and your need to cover an existing mortgage on your property. On
auction day, the market will determine what value is acceptable for your
property. The fact you are doing an auction does not change what the market
value of your property is. In short, if the true market value is at a level
below your existing mortgage, then that is the price you have to work with
regardless of whether you use the traditional method or auction method.
Q. Where will the auction be held?
A. We hold all auctions on site or in a central meeting facility, depending on
the needs of the seller and the number of properties being offered at once.
BUYERS
Q:
I've never bought real estate at an auction; how does the process work?
A: Buying real estate at auction is a very simple process. However, it is
important for you to be informed and prepared prior to auction day. You should
inspect the property during one of the scheduled preview dates.
Q: What is the asking price for properties?
All of our auctions are conducted utilizing the "Open Cry" bid system.
There is no beginning asking price. A starting bid comes from qualified bidders
who are attending the auction.
Q: What are the advantages of buying real estate at auction?
A: All of our auctions are "Open Cry" type auctions, meaning that all
of the bids are asked by the auctioneer and the bidders simply signal the
auctioneer that they accept. Since this is open for everyone to see, there
is an inherent honesty to the process. You are only competing against the
other market bidders and you will not overpay. Buying real estate at
auction allows you to experience a quick purchase and closing, eliminates lengthy
negotiations, and provides the assurance the price paid was market value.
Q: Why are properties sold at auction?
A: The speed of the marketing process is the number one reason anyone chooses an
auction. Owners make a wise business decision to sell property in a
one-day sale rather than continuing to incur carrying costs and negotiating in a
manner associated with conventional marketing. Sellers are motivated to sell and
offer you an opportunity to purchase desirable property at a substantial
discount. Over 90% pf properties offered are sold at their auctions. There are
many other reasons the sellers like the process and you can see them on the
Auction Advantages page.
Q: How are auctions conducted?
A: Most auctions are conducted by open bidding. As a bidder, all you need to do
is hold up your bidder card and call out your bid, or tell one of the Bid
Assistants what amount you want to bid. The Bid Assistants are there to help
you.
Q: Do I need to be represented by a Real Estate Broker in order to buy at the
auction?
A: No. We do encourage buyer-broker participation; however, it is not a
requirement.
Q: Can I make an inspection of the auction properties prior to the auction?
A: Yes. All of our auction properties have an inspection date posted on the
property page and in the advertising. We strongly encourage you to view the
property as you will be purchasing it "As Is, Where Is." However,
properties that remain occupied by tenants are not typically shown. Vacant land
properties may be viewed anytime without supervision although we have dates that
a representative will be on site.
Q: Is financing available?
A: Some auctions have financing available while others do not. See the
information listed in your specific Auction Catalog to determine this.
Q: How long do I have to get financing after the auction?
A: We suggest, if financing is required to complete a purchase, you arrange and
pre-qualify with a lender prior to the auction date. Basically, if you fail to
pay the balance due by the closing date, you forfeit your bid deposit.
Q: What is required in order to bid at an auction?
A: You MUST register with a valid ID (Driver’s License) on auction day and
receive a Bidder Card in order to bid. If you are the highest bidder
for a property you will be required to make a bid deposit on auction day.
This amount is posted on the property page of the web site and in the brochure.
Q: Can I buy more than one property?
A: Yes. You just need to bring and present a separate check for each property
you intend to purchase.
Q: What does "Absolute Auction" mean?
A: Real Estate being sold "Absolute" means the property will be sold
to the highest bidder, regardless of the high bid price.
Q: What do the terms reserve and absolute mean?
A: An auction where the property is being sold with a reserve means that the
property is being sold subject to seller confirmation. We try very
hard to make sure that the reserve is reasonable and that the seller is very
motivated to sell at the high bid achieved regardless of the reserve amount.
When a property is being sold absolute it will be sold to the highest bidder
regardless of price.
Q: Do I have to make any more deposits other than my bid deposit before
closing?
A: No. The bid deposit is a non-refundable deposit and it is usually an
amount that we feel comfortable that will make sure that the buyer will
close. The bid deposit is held in escrow and is deducted from the total
purchase price equal to the bid amount plus the buyer's premium.
Q: What happens once I have become the successful high bidder?
A: You will move to the contract table where you will present your check for the
bid deposit and complete the
Q: What is a Buyer's Premium?
A Buyer's Premium is a percentage amount paid by the buyer and added to the
highest successful bid to determine the final contract price. If a bid is being
utilized, it will be detailed in the auction catalog.
Q: To whom do I talk to if I don't understand the auction contract?
A: It is very important for auction buyers to be educated and informed regarding
the auction process. Make sure all your questions and concerns are answered
before you attend an auction. The contract is available by contacting our
offices. Feel free to have your legal advisor review the contract prior to
the sale.
Q: Is my deposit refundable if I change my mind after the sale and decide not
to buy the property?
A: No. If a buyer does not close for any reason on or before the closing date,
the initial deposit is automatically forfeited.
Q: When and where are closings held?
A: Closings generally occur from within 30 days after an auction. Since the
seller typically pays for title insurance, a company has been selected and will
be provided to you in the contract room.