RealEstateAuctions.com

Let’s start at the beginning: What exactly is a real estate auction?

Great question. According to Real Estate Principles and Practices by Philip A. Benson and Nelson L. North, an auction is “A public sale to any person bidding the highest price, upon terms and conditions previously announced.”

That’s the textbook definition. We like to add that an auction is a highly effective method of buying and selling, in an accelerated time frame, with distinct advantages for buyers and sellers.

So what’s the event held by RealEstateAuctions.com?

Quite simply, it’s the best assemblage of properties for sale in one place, featuring single family homes, apartment buildings, commercial property, vacant land and more.

What are the “distinct advantages” mentioned in the first answer?

For the seller:

1. Quick sale
2. An end to carrying costs
3. Buyers come prepared and qualified to buy
4. Property is exposed to a large number of potential buyers at once
5. Competitive bidding
6. Assurance that the property will sell for true market value
7. Protection of a minimum bid or reserve so the property is not sold for less than deemed acceptable

For the buyer:

1. Many properties to choose
2. Motivated sellers
3. Full disclosure and ample inspection time
4. Ability to bid to any comfort/value level
5. No lengthy negotiations
6. Same terms as all other bidders

How does it work?

The auction brings buyers and sellers together to transact business in a unique forum that accelerates the process by having buyers already qualified and properties already inspected and ready to close.

The next auction by RealEstateAuctions.com will be held from 11 a.m. to 2 p.m. Saturday, March 27, 2010 at the Marriott Oak Brook, 1401 W. 22nd St. in Oak Brook, Illinois. Registration personnel will be on hand to assist people who have come with the intention to bid at one or more of the property auctions. A facilitator will begin the activities by reviewing the legalities and rules of the day.

The contract and paperwork is handled right on site and a closing is typically scheduled within 30-45 days.
Each auction starts with a brief presentation on-screen and contained in a printed brochure showing a photo of the property plus relevant facts. The auctioneer begins the bidding process and potential buyers indicate their interest at each bid level by raising a numbered paddle they received at registration. When no one is willing to bid further, the auctioneer announces the property “Sold!”

I’m a potential SELLER. How do I take part?

Register Online 

Use our convenient Auction Registration. An RealEstateAuctions.com Auction Specialist will contact you and provide a Listing Presentation for the property you’d like us to consider. The Listing Presentation will contain Terms and Conditions, a schedule of fees and other details. Our Auction Specialist Realtor® will walk you through each step of the process.

Attend our Free Sellers’ Seminar

Before each auction, we’ll hold one or more free seminars to educate sellers about the benefits and mechanics. The auction will feature single family homes, apartment buildings, condos, townhomes, vacant land, commercial property and more. If you’ve got one or more properties for sale, we’d love to hear from you. Register today!

As a seller, what does my property need in order to be eligible?

Basically, three things:

1. Clear title at closing (meaning no liens or back taxes owed).
2. Disclosure packet. Our representatives will assist you with identifying what’s needed.
3. Three open houses for inspection by potential buyers. Our representatives will staff the open houses for you.

I’m a potential BUYER. How do I take part?

1. Have cash backing or financing pre-approval for a purchase. You must be a serious bidder and have the means to close on any property you purchase within 45 days. There are no financing contingencies.
2. Pre-register online with our convenient Auction Registration.
3. Examine the list of properties for sale and identify one or more favorites.
4. Attend the applicable open house(s) and collect the disclosure packet(s) available.
5. Thoroughly review the disclosure and all documents related to the auction, including the Sales Contract. Be sure to consult an attorney, real estate professional and/or an appraiser as you see fit.
6. Bring a cashier’s check in an amount specified for each property you intend to bid on.  If you do not purchase, you simply return the check to your bank and re-deposit the funds.

What types of auctions will I see at the event?

Typically, three types:

1. Absolute Auction, meaning the property will be sold to the highest bidder, no matter what that bid is.
2. Minimum Bid Auction, meaning bidding must reach a pre-determined price set by the seller before the property can be considered sold. Once bidding reaches the Minimum, an announcement is made and the bidding continues, with the property then selling Absolute.
3. Reserve Auction, meaning that the seller has time to consider whether to accept, reject or counter the highest bid. This time period is usually three days.Buyers know that the Absolute Auction is typically the most exciting because of the potential for a great deal. And sellers know that there’s no better way to get buyers juiced up about a property than to list it Absolute. Often, the bidding becomes so competitive that the price escalates beyond the seller’s expectations.

Sellers, therefore, have protection with the Minimum Bid Auction and Reserve Auction if they want to be assured their properties will not sell below what they deem acceptable. However, these auctions can be counterproductive if the Minimums and Reserves are set too high, which will discourage bidders. Your RealEstateAuctions.com Auction Specialist can assist with your strategy in this regard.

Can anyone attend the event?

Absolutely! We all learned about auctions by attending our first as spectators. But please understand we reserve the right to seat our pre-registered buyers and sellers first, followed by spectators, if space is still available.

What’s the procedure at the auction?

Following check-in, buyers, sellers and spectators will be greeted at the start of the event by a facilitator who will review various terms and conditions, as well establish ground rules for the day.

When bidding opens, a picture of a property will be displayed on one or more large screens in the room. The auctioneer will begin to solicit bids, and buyers will indicate their participation at the given price level by raising a numbered paddle they received at check-in. This is called open bidding. Remember, each sale will be Absolute, Minimum Bid or Reserve and it will be indicated on the brochure and by the auctioneer verbally at the start of bidding for each property.

Using his unique and colorful dialog and cadence, the auctioneer urges the bidding along until it will go no higher. He then declares the property “Sold!” and the winning bidder proceeds to an area just outside the auction room to sign contracts.

Can properties be sold before the auction?

Yes.

What will be my total cost if I am the winning bidder?

You’ll pay a 5% Buyer’s Premium in addition to your bid. Also, if the certified funds you brought do not equal the downpayment, you’ll be required to make up the difference with a personal check.

What is the anticipated closing time?

Buyers and sellers benefit from a quick closing schedule. Expect closings to occur no later than 30 to 45 days after the event.

Do I need a real estate broker to represent me?

No, although if you are working with an agent, he or she must attend and register in order to be eligible to earn a commission. Whether you are a buyer or seller, indicate you are working with an agent when you fill out our online pre-registration form and supply his or her name and contact information.

Is financing available?

Remember, if you intend to bid, you must be a serious and prepared buyer. That means ready to close with cash or have financing already pre-approved. We will have a preferred lender available to assist, but be sure to get the financing process underway before the auction takes place.

Can I purchase more than one property?

Of course. Bring a separate bank check for each property you are considering.

If I don’t close due to financing or other situation, what happens?

Earnest money will be forfeited. In addition, a seller may seek legal action. The auction, while fun and full of advantages for buyers and sellers, is not a place for tire-kicking. Sellers will have clear title and will be ready to close. Buyers, therefore, should have the properties researched, have financing in place and also be ready to close.

If I register as a buyer but don’t make a purchase, what happens to the certified check (or cash) that I’ve brought with me?

It never leaves your posession until you are the winning bidder on a property.

Can someone else bid for me, or can I bid for another person?

Yes. A notarized Power of Attorney authorizing you to bid for another (or vice versa) will be required.

During bidding, can I accidentally purchase a property if I scratch my nose or my head?

We’re happy to tell you no. Thanks to television and the movies, the impression is that any flinch, scratch, sneeze or other movement will obligate you to buy. It makes for great comedy, but it’s just not true. The auctioneer at the podium and his assistants roving through the crowd know what to look for. You’ve got to take very deliberate action in order for a bid to be recognized.

Well, I like what I hear about this event. What’s the first step again?

Pre-register on our site and we’ll get you started right away!