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- For AvalonBay, Long Island Filled With Risk, Reward July 29, 2010The region near New York City is one of the nation's toughest markets to development properties. AvalonBay is undeterred. […]
- Miami Tower Built for Storms July 28, 2010A Miami-based developer is seeking to capitalize on predictions of a rougher hurricane season, which may be a marketing opportunity for him and his new tower at 1450 Brickell Ave. […]
- Office Developers Revive Plans July 28, 2010With Europe's financial sector showing signs of stabilizing, developers have begun to dust off plans. A development boom, however, isn't likely anytime soon. […]
- It's a Low Point for High Point July 28, 2010Vornado Realty Trust is opting to forfeit a 2 million-square-foot furniture mart in High Point, N.C., to holders of its $191 million securitized mortgage. […]
Posts Tagged ‘buying real estate at auction’
Auctions
You are ready to buy a home! How exciting is that! An auction may be a great way to get your price and reduce the time and red tape of a traditional home purchase. Can you imagine moving into your new home in as little as 30 days? It can happen and we are going to give you all the information you will need to be an expert no matter if you are a buyer, seller or Real Estate agent.
First of all what is a real estate auction? To be successful in real estate you must be innovative and be ahead of the curve. Auctions can be that innovative way for a real estate company, buyers or sellers to effectively sell or purchase properties. To put it simply, auctions are an intense, accelerated real estate marketing process that involves selling any type of property including non-distressed properties.
What are some of the benefits for an auction? As a seller you know buyers have come to buy and by the end of the day you can rest assured your property is sold. Potential buyers must pre-qualify for financing prior to the auction and with a quick sale it greatly reduces your long term carrying costs, including taxes and maintenance. When the property is sold you know that you received true market value by creating competition among buyers who were truly interested in buying your property.
As a buyer there are also many benefits to buying at an auction. Buyers know the seller is committed to selling eliminating long negotiating periods and know they are competing fairly and on the same terms as all other interested buyers. You know when buying at an auction you are buying at fair market value through the competitive bidding process. One of the most valuable benefits to buying property at an auction is you know then and there when you will be closing and taking possession of the property, many times in as little as 30 days.
Many people don’t think about the benefits for real estate agent in auctions. For agents it offers their clients and customers alternative options to sell or buy property. It also guarantees the property will be sold at market value and in a relatively short period of time.
Auctions have been around a long time because they are an effective and efficient way to sell real estate and meet the needs of the public. Auctions are entertaining and most people who have been come back again and again, so if you haven’t yet attended an auction try it. I guarantee it will not be your last.
Buying at Auction
Buying at auction can have many advantages but it is helpful if you have a guide. There are a lot of things to consider if you want to do it right. First of all, what are some of the advantages of buying a property at an auction? There are many and we will only name a few of the most important.
Properties are offered at a competitive price and if you do purchase a property you know you have paid fair market value, no more. If more than one person is interested in a particular property the auction demonstrates free and fair competition enabling the buyer to buy the property at a price that is competitively achieved against other known bidders.
If you are the successful buyer of a property you know the seller cannot renege on his price and the property is yours upon completion.
When buying at auction the seller guarantees a clear title upon closing with no tax liens or mechanics liens assuring you of no surprises down the road.
Most auctions will offer a catalogue with the description of the properties, how to view each property and the general conditions of the sale. Ample opportunity is given to view the property and you can seek professional advice from surveyors and appraisers to help you decide on your offering price.
As a buyer at auction the sales process is accelerated for both buyer and seller. What this means to you as the buyer is you can close and take possession in as little as 30 days avoiding lengthy negotiations of price and terms. Most traditional real estate transactions can take as much as 90-120 days before you can move in. The purchase is based on your time table not the seller or the bank.
These are only some of the advantages of buying at auction which has become an increasingly popular means of buying property in recent years. The real estate market has certainly had its ups and downs over the past decade but one constant since properties have been sold since roman times is the auction. It is a tried and true method to convey property that will be around for a long time to come so look into it wherever you live and maybe you will find that home or condo you have always been looking for. It is fun, it’s exciting and the end result is everyone comes out a winner.
Auctions
Auctions are a great way to buy a home no matter if it is your first, second or investment property. There are so many advantages that I only have time to name a few but keep checking out our website for more information on when our next auction will be held and what properties will be available.
There are three basic types of auctions any of which can be done at our auctions. The most popular type of auctions with customers is the absolute auction. This means the home will absolutely sell that day, no matter the price, highest bid wins. The sellers brought the home to auction to sell and are ready to do so no matter the price. You may think this is a distressed sale but many times an absolute bid is higher than the seller ever thought possible. The reason for this is the excitement the auction generates with bidders getting caught up in the process hoping to buy at a great price. Buyers and sellers benefit from this type of auction. Buyers know they are going to pay only what they want for the property and the sellers know their property will be sold by the end of the day. The second kind of auction is minimum bid. In a minimum bid auction the prices is set below the list price, rock bottom of what the seller is willing to take. The minimum bid is published in the auction catalog, on the website and announced by the auctioneer at the start of the bidding for this particular property. As long as someone bids that price the property will sell that day. If no minimum bid is offered the property is not sold and may be help over to the next auction. The last type of auction is the reserve auction. The seller has set a price he is willing to take but it is unpublished. Bidding will start with an opening bid and progress normally. A couple of things can happen at this point which is what makes many auctions exciting. Once a particular price is reached the seller can notify the auctioneer that the property is now an absolute bid property. In other words, when the final bid is called out and the gavel goes down the property is sold.
Auctions can be a great way to buy property. In today’s real estate market auctions are becoming more and more an attractive way to buy and sell properties.
REO Properties
The challenges facing the real estate market in the last few years have brought to the forefront a term that many have never heard of, REO properties. REO stands for Real Estate Owned and most times is property taken back by a bank or mortgage company when they could not sell it at the foreclosure auction. Most foreclosure auctions do not result in any sort of bid because if there was enough equity in the property the owner would have probably sold the property and paid off the bank or mortgage company. Most foreclosure sales begin with a minimum bid that will include the loan balance, accrued interest, attorney’s fees and any other costs associated with the foreclosure process. Since what is owed the bank or mortgage company almost always exceeds what the property is worth, foreclosure auctions normally do not result in a successful sale which means the property reverts back to the bank or mortgage company which then becomes an REO, real estate owned property.
A bank REO property may or may not be a good deal. Many people think that by buying these properties they are getting a great deal and making a killing in the market. That sometimes is true but most often not. These are things to think about before an offer is made. You should always ask, are there any inspection reports, what work has the bank agreed to, how long will it take for the bank to accept the offer and are there any special forms that will be needed to complete the sale. Bank owned properties are almost always sold “as is” meaning there may be repairs needed or other liens on the property which will need to be satisfied before clean title will be conveyed. It may sound like the bank is just dumping these properties but they may be of assistance with handling an eviction, do some repairs, pay off homeowner’s association fees and negotiate with the IRS to remove any tax liens.
It is a lot of work but there are advantages to purchasing REO properties over foreclosed properties. Once a property becomes an REO property all the liens are removed and taxes are paid in full. REOs are normally listed with real estate agents and inspections are allowed prior to contract which means the property is typically restored to a salable condition. An additional benefit with REO properties is that the bank or mortgage company will many times offer better financing than they might offer for traditional properties. Lenders and mortgage companies do not want to hold on to these properties very long because of the cost to maintain so if you do your homework and are willing to take a risk it just might be your entry into the homeowner market.
What Happens on Auction Day
Consumers are naturally curious about what happens on auction day.
It’s a busy and fun-filled time, to be sure. The staff of RealEstateAuctions.com has prepared for weeks to make this event worthwhile and beneficial for buyers and sellers.
Participants are required to arrive at least 30 minutes prior to the start of the event to register and pick up all necessary materials. A full hour in advance is really the best bet, as most people typically cut things very close time-wise. That’s human nature, it seems!
Upon arrival, buyers will produce (but not surrender) the certified check they have brought for each property theay are interested in bidding on. Registration staff will also ask for a government-issued photo ID, such as driver’s license, passport, etc., as proof of identity. Buyers receive a copy of the auction Terms & Conditions along with a numbered card, or paddle, that they will hold aloft when making a bid at auction. Buyers will also receive a printed brochure or pamphlet with basic information about each property for sale that day, including photos, adresses and prices.
Sellers also check in with staff at the entrance to the auction room. Sellers will be shown to a designated area in the auction room where they can be positioned to be in contact with the and a RealEstateAuctions.com facilitator as they event progresses.
Spectators are welcome to attend to experience what happens on auction day. We require spectators to check in and register with staff outside the auction room. Spectators can take a printed brochure or pamphlet to follow along with the action, too. Attending a real estate auction as a spectator is a great way to learn about the process and see if it’s something you’d like to take part in.
An event facilitator welcomes the crowd and reviews the basic ground rules of the day. The event kicks off in earnest when pictures of the first property appear on the screen and the auctioneer takes off into his signature chant.
Auction properties will vary in their popularity. Some properties receive a high amount of bidding, some less. Bidders raise their paddles to indicate their bid as the action skips back qand forth across the room, always under the watchful eye of the auctioneer at the podium and his bid assistants stationed in the crowd.
Absolute auctions are the most exciting. Properties sold “absolute” means the highest bid wins. Sellers are sometimes reluctant to offer their properties in the absolute category, fearing the bidding might not be high enough. Often, the opposite happens because bidders in an absolute auction know that if they go just go a little higher in price, the property could be theirs.
Once a winner is declared, a friendly associate with RealEstateAuctions.com shows the way to the contract administration area where paperwork begins for the purchase of the property, concluding what happens on auction day.