Real Estate Auctions - When Should You Use Them?

Real Estate Auctions have been used to sell2. On any property in a hot market. If you're in a
properties successfully for many years. Do theymarket where multiple offers are common for any
always work? No, but if done in the right way, theylisted property, take advantage of that excitement
ALWAYS attract attention. They ALWAYS make aand let buyers bid against each other in an open
property stand out from other properties on theformat.
market.3. On any good investment deal. If you have a
There isn't a magic formula that will always sell aproperty that needs to be rehabbed, income
property, except price. An auction gives you theproducing property with good cash flow, or any
ability to use price as a way to attract buyers.other type of good investment property. Investors
However, the majority of buyers that you attractbuy based on numbers, show them the numbers!
are expecting a deal. So, unless your property is in aUp until a few years ago, seller's who wanted to sell
hot real estate market or is unique and highly desired,by auction usually held a "live" auction on the
you need to expect to sell at a discount. You shouldproperty. This process requires hiring an auction
expect to discount at least 10% and many timescompany and paying hundreds and sometimes
more.thousands of dollars in fees regardless of whether
If you're considering selling by auction, you need tothe property sold or not.
realize that you will probably be giving up someAlong came the Internet, and then Internet auctions
equity for the convenience of selling fast. However,for "stuff". Now Internet Real Estate auctions are
time is money, and it still makes sense for manystarting to take hold. One of the advantages of using
sellers to use this method. Not to mention, therethe Internet is that it doesn't require people to be
have been many auctions that have received bidsonsite to bid. Bids can be placed anywhere a person
right at, or higher than market value.has access to the Internet.
When should you use an auction?It's understandable why real estate Internet auctions
1. On any property that you are willing to take atare becoming popular. They make this successful
least a 10% discount. The bigger the discount themethod of selling real estate accessible to many
better chance for success.more sellers and investors.