The traditional method for selling your Saline real estate is to list it with a Broker. By “traditional”, I mean only that most sellers choose this method. You ask your friends and relatives for the name(s) of reputable Realtors®. You contact each of them, making note of the ease of reaching them, and your comfort level in speaking with them (after all, you’ll be speaking with them a lot during the selling process). You choose one and begin the listing process.
In today’s market for Saline real estate, we have an 11-month supply of homes available for sale. What that means is that it could take many months to get your home sold. (Let me emphasize that it could take that long, depending upon your asking price).
But what if you can’t wait that long to get your property sold?
There’s always (gasp!) an AUCTION (HUGE GASP!)
Why would you choose an auction?
With a real estate auction, you have the likelihood of a certain date for the sale of your property. I must emphasize that it’s only a likelihood – which you’ll understand more below.
There are two primary forms of auction.
1. An ABSOLUTE auction. This is where the property sells, no matter the hammered price. It is via an absolute auction that you get the most interest from the buying public, as they know that THEY could be the one to scoop up your property at THEIR price.
At an absolute auction, you also know the exact date that your property will likely sell. (I say “likely”, because until the buyer actually hands over the certified check to the auction house, it still isn’t sold).
2. A RESERVE auction. This is where the property sells, but only if the hammered price is above your minimum price. At a reserve auction, you’ll generally see fewer buyers than you will at an absolute auction. Bidders at a reserve auction will not know your minimum price. My guess is that a bidder’s thought process will be something like this – “I’ll bet they set a reserve because they ‘have’ to get a certain price, so I won’t bid as high, and hope only that I’m above the minimum.” Contrast this attitude with one from an absolute auction, where the bidders will continue to bid until they either win, or reach their maximum bid level.
At a reserve auction, if the reserve price isn’t met, you still won’t have a certain date that your property will sell. You may have to list it for sale again with a Realtor®, or try another auction. But understand, once an auction fails, the likelihood of a bidder increasing a bid amount is totally diminished. This ties into one of my fundamental truisms of real estate – the first offer is USUALLY the best offer.
I have been the listing agent for sellers at auction in the past. It is a gut-wrenching process to go through – not for those with a weak stomach. It’s not like eBay where you don’t see the seller or the other participants. Think about this. You have to know with absolute certainty what price you will accept, and stick to it. No wavering.
In one particular case, I recall watching a seller writhe in agony as the hammered bid amount was just slightly below the reserve price. I advised the seller to accept the bid, even though it was below the reserve level. While the seller deliberated, the buyer tapped his foot, waiting, and about two minutes later, walked away. The seller lost the sale, and eventually lost their house to foreclosure. Rather than accept a little less than they “wanted”, they lost their entire equity and their ability to borrow for years to come. All for a couple thousand dollars. Ouch.
If you’re wondering about an auction of your Saline real estate, ask an experienced Realtor® first.