Luxury Property Auctions

By: Aaron Norris/PropertyRadar.com

Luxury Property Auctions – high-end real estate not in default

Luxury property auctions don’t usually feature properties in mortgage or tax default. Rather, these are high-end properties sold at auction to avoid the lengthy time on the market (sometimes in excess of a few years) that luxury properties often face. The rules for these auctions are set by the seller and the auctioneer, so be sure to read them carefully before bidding.

Pros & Cons of Luxury Property Auctions

While you can’t expect to walk away with a killer deal every time, these sellers typically have selected an auction because they really need to sell by the auction date, rather than having the uncertainty of listing the property with an open-ended timeframe.

With that time pressure, they may be willing to accept less, sometimes significantly less, than the value they might get waiting for the right buyer. On the other hand, really hot properties may sell for more due to the excitement and competition of an auction.

What Types of Investors Luxury Property Auctions Are Suited For

• Anyone looking for a deal on luxury property.

Pro Insights – Luxury Auction

Real estate professionals take a ton of time preparing for auctions. Luxury auctions are an excellent place to briefly discuss the differences in three types of auctions:

• Minimum bid auction: Also known as a published bid auction, the seller and the auction house will publish this agreed-upon price in their marketing. While bidding may start lower, the property will not sell until it reaches this minimum price. If bidding doesn’t reach the number, the seller retains the property. Potential buyers like the transparency, sellers like the safety net and control.
• Reserve auction: Unlike the minimum bid auction, a reserve auction allows a seller to set a price that is undisclosed to buyers. Prices that appear in marketing doesn’t necessarily have nothing to do with what the seller will ultimately accept at auction. Sellers like it because they retain control. Buyers dislike this form of auction because they may end up wasting resources preparing for an auction where the seller is just completely unrealistic. Auctioneers also don’t like this type of auction if it’s paired with an unrealistic seller because they don’t get paid unless a property sells.
• Absolute auction: This is the most exciting form of auction. When an auction is marketed as an absolute auction, it means the highest bidder wins no matter what the price, guaranteed. From the seller perspective, this appears very risky because they won’t have final say if the bidding does not reach expectations. However, when auctions are marketed as absolute, it’s more likely to draw serious bidders in quantity ready to buy, not bid.

If you are interested in selling real estate, please allow Target Auction Company the opportunity to detail the benefits of our auction platform and provide you with a free consultation. We can offer the information and advice needed to make a sound decision regarding the sale of your property. We can be reached by email, at 1-800-476-3939 or visit www.TargetAuction.com.