The Truth About Real Estate Auctions

22 Mar The Truth About Real Estate Auctions

Everybody loves an auction. Buyers love them because they think there are deals to be had and sellers love them because they think they can get more for their property. But is all this love really justified?

Remember, there will always be costs associated with putting your property up for auction. The auction house will charge their commission on the sale plus a fee REGARDLESS of how (or even if) your property sells. You need to make sure you’re aware of all these costs up front.

Also, remember, an auction is a market working in real time. So if the group of investors decides that your list price is way too high, the auction will establish a new value for your property right then and there – and it may be much lower than you were bargaining for.

One benefit of using an auction is being able to know exactly when your property will be sold. This may have its own advantages if you need to unload property quickly but don’t want to simply slash the price. An auction may be a good option at that point.