Maybe Sellers Need to Consider an Auction!

As a Seller, have you thought about a quick sale, competitive bids and expedited closing that comes from a real estate auction?

Each year, more and more Sellers consider auctions as a new and often enjoyable option because of the added exposure for properties, and strong potential for a quick sale.

And the growing number of online auctions – from government sponsored to private – means even greater opportunities to market stale listings and engage new home shoppers in convenient online searches and bidding.  Online bidding at auctions is fast, safe, and brings immediate results!

Advantages for Sellers
Arguably, one of the toughest parts of selling a home is playing the waiting game, particularly when the sale is urgent. Homeowners constantly wonder: will there be a showing this week?  When will we see an offer?  Are the buyers out there?

Auctions can help eliminate these variables.  Sellers name the time, date and location of their home sale.  People who show up are there for one reason only –  to buy!   And, our auction company assumes responsibility for making sure qualified buyers turn out for your auction.

Auctions can be used in regular homes sales, short-sales, and pre-foreclosures.  Auctions can also be used to liquidate tracts of land, lots, acreage, etc. as well as commercial properties!

Advantages for Buyers
Buyers are drawn to auctions because they’re in control.  Once they’ve previewed homes with their real estate agent, or with a professional inspector, all that’s left at auction is deciding how much to bid.

Buying at auction means no waiting for a seller to accept an offer.  In an Absolute Auction, the highest bidder takes the prize, often within a few weeks of the sale. And auctions are a good way for consumers to get more for their money.

Place Your Bid
Your responsibility is to understand the auction process, touring and inspecting homes before events; looking at comparables, and talking with the auctioneer at Florida Auctioneers & Realty, LLC, or at least reviewing their website to find answers to your questions.  Simply click on: www.AuctionsSellProperty.com and find out more about real estate auctions.  Only deal with a State licensed Auctioneer who has the knowledge and experience to conduct your auction!  Call us at: (941) 927-8108.

Take time to learn more about the opportunities auctions can offer you, and consider this emerging sales strategy.

Q. I am interesting in buying a  home at a local courthouse foreclosure auction. I don’t want to spend more than $125,000. What’s involved? Can you find a good deal at one of these auctions?

A. You can pick up a great deal at an auction—if you do a lot of research (due diligence) in advance, and don’t get emotional.  Just realize that seasoned investors often cherry-pick most of the best properties and try to make a deal with the owner before the property hits the courthouse steps. You’re playing in the big league here, so tread carefully!  You should find a good Buyer’s Agent who’s experienced with foreclosures and have them represent you.  The fee that you will pay the Buyer Agent is small in comparison to what you could lose!

Still, some bargains do make it to the auction.  But before you bid on any, I suggest visiting a few courthouse sales to familiarize yourself with the process and players.  Also, please note that many of these auctions are now being held online rather than on the courthouse steps, so check with the Clerk of Court for specific guidelines.  In the Sarasota, Manatee & Charlotte County areas, you can find such sales listed in the classified section of the Suncoast Business Review newspaper, which is published weekly, or on the Clerk of Court’s website.  In Florida, sale notices must be published in a newspaper for 2-3 weeks, with the last ad occurring no more than seven days prior to the sale. Or, you can subscribe for a fee to one of the numerous foreclosure websites like RealtyTrac, but that can get expensive.

When you’ve located a few properties that match your specific desires, look up their addresses on websites like Zillow.com to see what home values are in that specific neighborhood - since you’ll have to pay more in costs and repairs than you would in a regular sale, you generally don’t want to pay more than 70% of market value. Although you probably won’t be able to get inside any of the properties to conduct a professional inspection, at least drive by to check-out their condition(s) and surrounding neighborhood.

More importantly, search courthouse records to see what liens have been filed against these properties, and who has initiated the foreclosures.  Usually, it’s the first lien holder such as a bank, but not always, since in Florida junior lien holders—with the exception of the tax lien holders—are wiped out in the final sale.  If a second lien holder is initiating the sale, you may have to pay off a hugh first lien, in addition to the auction price, so be very careful and do your homework, or you can lose your shirt!

Understand that after all this research, the properties you want may never make it to the final sale.  In Florida, as in many other states, homeowners have up until one business day before the auction to stop the sale by paying all  fees incurred and back mortgage payments.

If any of your selected properties do get auctioned, set a firm limit to what you’ll bid on each home, and don’t let other bidders (who might even be straw men working for the sellers) push you beyond it.  If you’re successful, understand that you are buying the property “As Is,” that you will be paying all closing costs, and that you won’t get the keys immediately. In Florida, courts must ratify all sales, a process that takes at least  several weeks. You’ll then be given  a few more days to close, and to start proceedings to evict the old owner or tenant, if necessary.  Backing out of the deal at any point after the hammer comes down in an auction is possible, but very expensive:  You’ll have to forfeit your escrow deposit, and the property will be resold at your expense.