Both locally and nationally, the auction method of selling real estate has been gaining attention and popularity. Many REALTORS® are becoming familiar with this option for selling or buying property
and can assist you in this process through education and by recommending an auctioneer for the sale of property, if desired.

There are three types of auction – absolute, minimum bid, and reserve. In an absolute auction, the property is sold to the highest bidder regardless of price; this generates the most interest and competition, therefore bringing about true market value. For a minimum bid auction, the auctioneer will accept bids at or above the published or announced minimum bid price. With a reserve auction, the auctioneer will announce that the property is sold on that date when the reserve (basically an unannounced minimum which is normally well below what a list price would be) is met in the
bidding process.

For sellers, an auction means a sale date is predetermined without contingencies or negotiation. There is not a traditional commission; brokers and the auctioneer are paid in the form of the buyer's premium, often 10% of the winning bid price.  For buyers, an auction presents an opportunity to purchase a property at true market value or less. Bank loan pre-approval and inspection of the property as desired before bidding is necessary.

If the auction option sounds like a possibility for you as a buyer or seller, call a
REALTOR® to find out more. Auction may be the right option for you.

Written by: By John Whitworth, Affiliated Auctions & Realty, LLC