Sarah Sonke, Auctioneer/Broker

Estate situations are so perfect for auction! The satisfaction of helping people during difficult transisions in their lives makes you proud of your profession.

Our clients lived for 50 years in their home and had so many wonderful memories. But "dad" was recovering from a stroke and had been moved into a nursing home. "Mom" was going through cancer treatment and wasn't doing well.

They decided it was time to move into an assisted living facility but the facility needed money up front and they didn't have it. A deal with the facility was finally inked that allowed them to move in early because they chose to auction their home rather than list it conventionally and wait for however long it might take to find a buyer.

The auction date was set within 3 weeks and we couldn't allow any showings of the property for the first 10 days while they were moving into the assisted living facility.

The house had a tax assessed value of $183,000 but the furnace was not longer working. There had been a roof problem that had been repaired but sheet rock that got wet was never repaired. This resulted in major mold problems in the master bedroom. Plus there was a lot of termite damage to the original part of the house.

In addition to selling the house, we were asked to sell much of the personal property in the house.

We had asked that both parents have legal documents drawn up to give one of their children power of attorney - just in case. And it was a good thing as just a few days prior to closing, "mom" passed away.

There were about 30 showings in 20 days.

Auction day brought 9 bidders, each bringing an $8,000 cashier's check in order to register to bid. There was a big tent in front of the house and about 40 neighbors and friends watched the bidders bid it out. The high bidder was a real estate agent who had always wanted to live in that great neighborhood. Sellers were ecstatic by getting far more money than they expected from the home sale. Plus they were able to move forward with their lives without losing a lot of money on holding costs for a vacant home.

The closing was set for 21 days after the auction.

Buyer and sellers very happy. Another great auction!

What a fantastic auction in Austin, TX on Saturday! It was repeat business from a family we've helped before. This time, Dr. Najam (Grandpa) had already moved out of state and was really tired having his house sit on the market unsold after a year. It was a lovely home with over 5,000 square feet on a beautiful golf course lot. Since the doctor owned the house outright, he authorized an "Absolute" auction which always attracts the most bidders and in turn brings the highest price possible.

The accelerated auction marketing plan attracted over 200 prospects in a 30 day period.

There were 10 registered bidders on auction day including one who flew in from California. The bidding started at $100,000 and the home was declared "Sold" 14 minutes later Our client had hoped to achieve a sale price of at least $275,000. The final sale price was $336,600.

The buyer said he exceeded his predetermined spending limit due to the bidding competition. His two sons were cheerleading their dad to win the bid and could hardly stand the excitement. Interesting point - this man's wife came by herself and saw the home the day prior to auction. She'd come primarily to purchase some of the furnishings. On the basis of her report, her husband got a cashier's check and came prepared to win the bid at auction beating out all other potential bidders who had studied it for weeks. Just goes to show that when the wife has been looking for the right house and finds it, BUY IT!

The sale will close in 30 days with no contingencies for financing or repairs. Should there
be any bumps in the road, we also have the under bidder on contract for $1,000 less
and he really wants the house too.

Is our client happy? He's over the moon happy and relieved, along with his entire family.
Now grandpa can finally move on with his life!

FOLLOWUP: Just a few days before closing there was a hail storm that damaged the roof. We were able to get a limited power of attorney from our client (the doctor) in order to expedite the insurance claim, meeting with insurance expiditer and sign contract with roofer for repairs. Meanwhile, closing went forward as scheduled.

Another happy auction story for both buyer and seller.

One of the most discouraging thing that can happen to sellers is to get a great offer and it falls through just before closing day. The sellers of Twin Oaks Campground had that experience and it almost wiped them out, both emotionally and financially.

The sale had fallen through at the end of the business year and it was extremely difficult to start up operations again. So the sellers had decided to close down operations and go to auction.

The marketing program was very targeted to specific groups we'd identified as likely buyers. It brought in over 80 prospects from all over the country including couples interested in purchasing the property as a campground as well as horse farm and many other uses.

One of the most difficult challenges was dealing with losses on the stock market and the lending environment.

Our final buyer were two couples buying the property together. One couple was from California and the other from western North Carolina. The sale agreement included training and the creation of a massive operations manual. It also included the sale of the assets of an LLC, although at the last minute the sellers decided not to purchase the name due to concerns regarding liability.

The sale closed just as the sellers were running out of cash as they had not been able to find work for months.

This project was referred to auction by a local agent and she earned a great commission check.

It was a really tough challenge. But then, professional auctioneers never get any easy projects!

After more than a year on the market, the owner of the Rosedown Plantation in Smithfield requested an auction. Rosedown is a unique property that is a 3/4 replica of a historic plantation in Louisiana. Along with the main plantation home is a guest house, two gazebos, outbuildings and a large stocked pond.

The accelerated auction marketing was really aggressive and attracted over 70 prospects from 8 states. The auction date was right in the middle of the stock market meltdown in early October. And during this same time, lenders were cutting loan programs and tightening credit requirements. We extended the auction date at one point by about 2 weeks because the daily 500 point losses were having an effect on the pool of wealthy buyers we had attracted.

Finally auction day came and we had one bidder who stepped up to the plate at the minimum bid which got the job done. Both seller and buyer were happy with the transaction.

Four months later, the seller has called asking us to consider auctioning a large land parcel.

We also just heard from the buyer. The family is using Rosedown as a 2nd home but it is also now a high class wedding venue with 6 weddings already planned. The original owner will be so glad to hear that as she had hosted a number of weddings at the plantation and two of the family members were professional photographers who shot many weddings at Rosedown.

Yet another happy auction story!

AUCTION UPDATE #1
Apex, NC Townhome Super Auction


Citiside Townhomes on Queen City Crescent, Apex, NC

Thanks for your interest in our upcoming auction of nine town homes on Queen City Crescent in Apex (across from the Beaver Creek Shopping Center).

Why an auction? Several units in this development have already been sold. The low minimum opening bids have been set by the builder in order to sell all of the remaining units quickly so they can move on to other projects. Auctions are a very efficient method for transferring real estate in a slow market.

How do auctions work? Auctions are actually quite simple compared to conventional sales. You just have to do all your homework up front, prior to bidding at the auction. This would include seeing the property, getting pre-qualified for a loan with a good lender and being prepared to close the sale within 30 days. In an auction, the seller sets the rules (auction terms & conditions) and the buyer sets the price (over a minimum opening bid). It can be a huge win-win for both parties.

Can the auction terms be negotiated? If you don't like the auction terms, you'll need to wait until after the auction when prices on any remaining units would be set substantially higher but sold conventionally on terms you can negotiate. Due to the minimum opening bid prices, you can tell that the builder is ready to let these units go at whatever price bidders determine on auction day (over the minimum opening bid). As a result, we don't anticipate there will be any unsold units.

How to prepare:
1. Come to the scheduled inspection periods on Saturday, April 4 and 18^th from 2 to 4 pm. If this time isn't convenient for you, call a Buyer Agent who can show you the properties on your schedule. Choose two units that you like best.

2. Check comparable prices for other town homes in the area. You'll love the minimum bids on the Citiside units, especially when you compare their features and quality of construction with other townhomes in the area.

3. Get pre-approved for a loan if you need one. This is vital in an auction sale. If you need a loan but are unable to obtain one by the closing date, you'll lose your deposit because it is nonrefundable. You can get an excellent buy at auction, but you have to have all your homework done up front and getting pre-approved for a mortgage prior to auction is vital.

4. On auction day, come prepared with a cashier's check made payable to your name in the amount of $10,000. Personal checks will not be accepted - it must be a cashier's check. The successful high bidder will endorse the cashier's check to AuctionFirst and it becomes a nonrefundable down payment.

5. Bidding - We'll have a practice bidding session prior to starting up the auction so you'll feel comfortable in how bidding works. The auctioneer will start the bidding at the minimum bid price and ask for advances in specific increments. You'll know exactly where the current bid is and the next bid increment being requested.

Buyer's Premium - All auction companies charge a buyer's premium and it's something that you factor into your bidding. In this case, the Buyer's Premium is 10%. That means you should bid up to 90% of the total amount you want to pay to purchase the property. For instance, if you don't want to pay more than $200,000 for a particular unit, you need to stop bidding at $180,000.

Can't come to the auction? Pre-bidding and simultaneous online bidding for these town homes will be available through http://www.Proxibid.com. If you'd like to bid while at the beach, soccer game or office, this is a convenient feature. Registration for online bidding must be completed several days prior to the auction so that your registration can be approved.

Buyer agents: The last page of the complete auction bid package is the Broker Participation Form. This must be completed and returned to us one day prior to auction. It identifies your client and protects your 3% co-op commission. Please note that you must attend the auction with your client without exception.

We teach a 4 credit hour NCREC approved class on the Fundamentals of Real Estate Auctions and there are 3 classes being taught prior to this auction. If you would like to understand how to better represent your client at auction, you should consider registering for this class. Please call me at 800-220-6760 for additional information and dates.

Due to the minimum opening bid prices, it's apparent that the builder is ready to let these units go at auction. But only to serious buyers who are prepared and qualified to buy on auction day. Start getting ready today so you can get a super deal!

Sarah Sonke, Broker/Auctioneer
AuctionFirst.com
919-601-7339 or 800-220-6760