Real estate auctions have seen an increase in gross sales in the last three quarters of 2007, according to recent industry surveys by the National Auctioneers Association (NAA)*. This is an important trend to consider given the current slump in the real estate market. But it is conceivable in light of the forecasted rise in foreclosures.
Investors are waiting on the market to show favorable conditions to buy--but real estate auctions and foreclosures may be just this opportunity! Consider that the current real estate market has led to an increase demand for persons or entities to (1) actually sell their property, and (2) sell it quickly to cut further losses. Auctions then become an ideal venue to "liquidate" and get out from under that property, especially when there are multiple properties to sell. With the number of closed sales down considerably nationwide and the turn towards a buyer's market, these auctioned properties are often sold at a considerable discount to the highest bidder.
"Discount" spells out investment opportunity!
An investor, however, shouldn't just jump into the auction ring. There is a lot of homework to be done! This is where using the expertise of a qualified and experienced real estate agent can be beneficial. The auction-experienced agent can provide:
- Knowledge of the area, including zoning, demographics, and local restrictions
- Comp data: recent sales information, current market trends, comparative market analysis, etc.
- Listing and sales history on the property
- Upcoming auction information
- Property previewing
- Guidance through the auction process
For instance, the real estate agent specializing in residential investments and auction sales can inform investors about specific auction terms and conditions, such as whether the sale has a minimum bid or reserve, and what the procedures are for inspecting the property and placing a bid. There are also a number of documents that need to be completed that the agent can assist with.
This is the time to consider purchasing real estate investments through the auction process--but learn before you buy!
For more information or for an updated list of local residential real estate auctions, call or email me.
Contact Ken Fish at: (239) 860-6521 or RealEstate@KenFishSells.com.
Ken Fish, REALTOR
Downing-Frye Realty Inc.
3411 Tamiami Trail N, Ste 100
Naples, FL 34103
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*National Auctioneers Association
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Ken, what I don't understand is why sellers would choose to sell at auction. Doesn't the house get 10% of the sale? Listing with a real estate professional at a competitive price ought to be cheaper.
Sandy