Why Auction?

Auction Traditional "List & Wait"
checkmark Buyers act on your schedule; they are coming to buy! x Little motivation for buyers; you wait for them.
checkmark The focus is on your property alone. x Property "one of many" being advertised and shown.
checkmark Auctions feature "Target Rich Marketing Campaigns" with directional brochures, newspaper ads, web/print media, cable tv and onsite signs. x Minimal advertising; heavy reliance on Multiple Listing Service.
checkmark Auctions create a sense of urgency, the "lure of a bargain", and a competitive bidding environment. x Top-down pricing immediately create "price reduction" to renew possible buyer interest.
checkmark Auctions build multiple buyer interest; Results in offers in 30 or less. x May remain on market for months or years.
checkmark Auctions eliminate guesswork in determining the asking price of your property. x Seller risks overpricing, and thus seeing little interest, or under pricing and selling for less than the property is worth.
checkmark Realizes the property's current true market value. No limit on upside potential. There is no ceiling on "How high is High" x Upside potential limited by "asking price".
checkmark All terms and conditions of sale set in advance, thus eliminating negotiations. Buyer pays all closing costs and pays 20% down in nonrefundable funds from pre-qualified bidders. x Seller must negotiate all aspects of sale.
checkmark All offers are presented to the seller before and during the auction. Property could sell prior to auction under auction terms. x Few offers are received, multiple offers at once are rare.
checkmark Property sold without contingencies; Sells "AS IS, WHERE IS" x Contingencies are common

AUCTIONS OFFER QUICK RESOLUTION & MAXIMIZE VALUE:

Experts now realize that nothing can truly replace the time-tested method of a free market auction when selling anything from the most liquid of assets - stocks - to one of the least liquid - entire companies. The same is true when selling commercial, industrial or residential real estate, estates and land.

Personal property, i.e. rolling stock, equipment, machinery, and inventories will also recover their fair market value by selling at auction.

BENEFICIAL SENSE OF IMMEDIACY:

Auctions create a level of interest and sense of immediacy unparalleled by other methods of selling, as such:

BEST TIME TO USE AUCTIONS:

Although auctions can be used to sell effectively in many situations, two particular circumstances are uniquely suited for this form of marketing:

1) When the asset is considered to be highly desirable; and

2) When a quick resolution of that property is required.

In the case of a highly desirable property, an auction helps gather many interested parties in one place at one time, creating a highly charged bidding environment. When desire, competition, and ego all meet in this atmosphere, sales prices can be maximized.

The owner's carrying costs are significantly reduced by the compressed time frame of the auction. Also, the auction forces buyers into a decision making process which can mean almost as much as the selling price to an owner under time pressure.

TYPES OF AUCTIONS:

Once the decision is made to utilize an auction, the next step in the process is deciding what type of auction to use. In general, sellers may choose between the following types of auctions:

1) Reserve auction in which the seller sets a predetermined minimum bid.

2) Absolute auction in which the property is sold regardless of price.

After the auction type is decided on, the marketing plan is developed. This includes target audiences, advertising, direct marketing, a sales prospectus, and potential owner financing. Finally, the marketing plan is executed, the auction event takes place, and the sale is closed.

AUCTION ADVANTAGES:
(Seller Benefits)