I’ve said it. In fact, I’ve essentially said something to this effect hundreds of times: “We sold a home at auction over the weekend in ten minutes …”
Yet, what exactly did we do in ten minutes?
We simply put the home in contract in ten minutes — not something any real estate agent couldn’t do — and in fact does frequently, particularly in a seller’s market.
There is no question that auctions put real property for sale on a schedule. As well, terms are typically seller-favorable and closing rates are usually much higher than in traditional real estate.
Further, auction prices are as high if not higher than traditional real estate prices, and considering the typical auction terms, almost always net the seller more.
Yet for me or any auctioneer to say “I sold a property in ten minutes” is somewhat disingenuous. What we do in ten minutes is put the high bidder in contract with our seller.
What can take a month or more up-front is marketing and what can take a month or more post-auction is getting to a closing table. While our ten minutes of contract construction might be minimal, it’s not revolutionary; some traditional real property sale contracts are constructed in mere seconds.
I’m in a home on one acre with an attorney just a few weeks ago. “So, we could auction this property?” she inquired. “Sure, and there are many benefits to selling at auction,” I responded. “It’s competitive — bidders fight over the property, we schedule the event, buyer pays commissions, buyer pays closing costs, buyer takes ‘as-is’ without contingencies, we get a big deposit, holding costs are minimized, and we sell to the highest bidder.”
Then I almost mentioned that we could sell the property in ten minutes when I stopped and thought — so could she. What we were offering was much more than a ten-minute contract construction.
Selling real property at auction has many benefits which all help the seller realize greater net proceeds. We explore the many nuances of selling real property at auction in the Accredited Auctioneer of Real Estate (AARE) designation class put on by the National Auctioneers Association.
Mike Brandly, Auctioneer, CAI, AARE has been an auctioneer and certified appraiser for over 30 years. His company’s auctions are located at: Mike Brandly, Auctioneer, Keller Williams Auctions and Goodwill Columbus Car Auction. He serves as Distinguished Adjunct Faculty at Hondros College of Business, Executive Director of The Ohio Auction School and Faculty at the Certified Auctioneers Institute held at Indiana University.
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