Real Estate Auctions

Real Estate auctions seem to be very popular these days. From personal experience, auctions seem to work very well for farm ground. However, for a home in town, sometimes it works, but many times it does not.

For farm ground, there is only a fixed amount of ground that is either tillable or in timber. That seems to drive the price up and the seller benefits.

For homes in town, a buyer is out for a cheap deal and if it does not work out for that house, there is another one very similar down the street. As a REALTOR, we have heard of homes that some at auction for only a fraction of the price that it would bring if it was listed. In one recent case, a house sold at auction for $125,000. The buyer did a little painting, listed it with a REALTOR and had an offer within a couple of weeks. The house resold at $156,000. A cool $31,000 profit for the buyer.

The message is that if you are considering selling a house by auction, make very sure that you know what you are getting into and perhaps it would be to your benefit to have a REALTOR look at it and give you an estimate of what it would sell for if listed. Most REALTORS will do that with no obligation on the part of the seller.

If you are thinking about buying a home at auction, just remember that the home is generally sold "as is", which means that any repairs are up to the buyer. In addition, there are no disclosures that tell of any defects that might be present. The auction process is truly "Buyer Beware".

If you would like to discuss the pros and cons of the auction process, please give me a call.