If you have a property to sell quickly, or one that’s not in move-in condition, one of the options you have is to put it up for auction. Auction properties are usually those that require substantial work or have been foreclosed on by the bank. That’s not to say there aren’t other houses to be found at an auction, but that is generally what you’re going to find.
The majority of buyers at an auction are looking to get a house cheap to do up and sell on, or to redevelop the land. Selling your property at auction is a valid option, but you should be sure it’s the right one for you before you put your property in an auction.
Houses up for auction will be listed with a real estate auction house with a minimum starting bid price, and they’ll advertise the homes for auction. The homes may or may not have a viewing window in which people can come to view the property in person, but they cannot have an additional professional come and formally assess the property. In some cases, potential bidders may register their interest in the auction.
On the day of the auction, buyers can attend online, on the phone, in person, or set up their maximum bid so the auction house can bid on their behalf. When a house comes up for auction at the event, they’ll start the bidding and potential buyers can up the bid as they (and the auctioneer) see fit. Provided the minimum bid and any reserve amounts are met, the property is sold to the highest bidder, and they must pay the full amount (or a minimum amount, such as 10%) before leaving the auction.
- Fast: Auctioning your property is a relatively quick and easy option if you’re looking to sell up. It typically only takes about 30 days, which means you don’t spend as long waiting for your money. Auction sales typically take less time than agent-assisted sales, factoring in the time to get the house under contract.
- Often low fees: Depending on the auction house, their cut of the total price may work out lower than if you listed it with a realtor.
- Buyers can’t back out: A traditional sale usually involves several “outs” – in other words, opportunities for the buyer to decide against buying right up until the very last minute. This can rarely happen at auction, and if it does happen, it’s usually because there has been some purposeful deception on the part of the seller.
- Sold as-is: Houses sold at auction are sold in “as seen” condition, so once you’ve won the bid, you can’t then get a home inspector to go in and see what’s wrong with it – you’re legally bound to buy it for the amount you won the bid for. This means that whoever buys your property can’t request any additional maintenance, fix-ups, or re-styling of the home, and they can’t add conditions or contingencies to the sale agreement. This means no inspections, appraisals, or mortgage financing hurdles to get over.
- Costs: Before you decide to sell through an auction, consider the extra costs that come with a veteran auction company that will deal with the marketing of your home’s auction. Most auction houses will charge a percentage of the sale price (like a realtor does) for their marketing and administrative work, plus their profit.
- You don’t get your money immediately: While the buyer is committed to buying the property the moment they win the bid, and usually have to pay a large percentage of the sale then and the remainder in the following 3-7 days, you won’t see your money for another 3-4 weeks.
- Time: While auctions are relatively fast, they’re not the fastest option. For example, you generally need to wait 3-4 weeks from signing the contract to the actual auction, and then another 3-4 weeks to get your money. If you’re auctioning a property, you should have an expectation that it could take up to 12 weeks to be all said and done.
- Lack of control: This auction company decides when and where to hold the auction, and they’ll usually have other rules you’ll need to be okay with, such as rules around the minimum bid or if you can refuse a bid and change your mind.
- No guarantee of sale: There’s also no guarantee of a sale because they can’t predict if there will be enough interest in your property to sell it at a price you’re comfortable with. That means after the 3-6 weeks of preparation, you may not be any further on toward selling your home.
If you’re sure selling your house at auction is the right move for you, your next step should be to find a real estate auction house that can list your house. Auctions are always held in batches, so your property will be up for sale with several others in your local area. In general, you’ll need to wait 3-4 weeks from when you sign the contract to auction day.
How you sell your property is entirely up to you, but it’s always worth weighing up your options before you make any decisions. Since your equity is involved, it’s worth noting why you’re selling up and how much time and money you have to spend before you need to make a sale.
If you’re looking for the fastest option, an auction will probably not be the best option for you (see below). If you’ve got a little time and you’re sure your property will attract some bidding competition, then it can be a good way to get the maximum amount for your property if you aren’t sure what it should be listed for due to disrepair, or other similar factors.
The sales method you choose will depend on your priorities, but if you’re looking for a quick and easy way to sell your property, working with a cash home buying company is a great option.
Selling your property at an auction can take up to 30 days, plus another 30 days to get your cash, and you may not have that much time, or you may simply want to know that you aren’t going to be left high and dry at the end of the auction without a winning bid.
Cash purchases can be completed in as little as a week, so if you need cash in a hurry, or simply want to be free of your property as soon as possible, this is by far your best option.
We’re a local family-owned company that wants to help you sell your property for cash, no matter your situation. With us, you don’t need to worry about redoing your yard, fixing up the kitchen, or doing any repairs. We’ll buy your home or condo as it is, with no viewings, meetings with realtors, negotiating, or haggling. Just a best offer for you to take or leave. It’s as simple as that!
We are proud to provide a fair and hassle-free service and we’re accredited by the Better Business Bureau so you know you can trust us. For more information or to get a no-obligation cash offer for your property, give us a call or text at 781-309-7085 or click here.