Auctions…they are just so 19^th century, right? Several months ago, I went to one with a buyer, for a home she had in mind in Reston, VA. She had a budget. Auction bidding went right past it. She eventually got a home on the street that she also loved, though at a higher price.

There are auctions every month or so, by different companies, for multiple properties. If the auction meets my buyer’s criteria, I will help them out. My goal is for them to buy a home, and any valid means which get us there are viable. You also will see individual homes that are auctioned off, and whether it’s a single or a multiple sale, the arguments for the buyer are the same.

With the buyer who is considering an auction, my role is similar to any other buyer. My role is to provide information on the home, similar to what I would in creating a set of buyer comps; to assist the buyer in understanding what the home is worth, regardless of asking price. Sometimes, the home in the auction is also on the market in the MLS, though usually at a much higher price. Nonetheless, that is an opportunity to get into the purchase sooner, and some homes slated for auction do get sold prior to auction. Often, I can obtain access and more information on the homes being auctioned. The more information I can find and interpret, the better informed my buyer’s auction preparation will be.

I went to another auction today, with another buyer. This particular buyer was looking for investment property in Washington DC. So, that was all I focused on. My data are at the bottom, but my conclusions:

• If the first winning buyer can’t complete the purchase application process, stick around, there were some good price drops.
  e.g., $135,000 first bid, re-auctioned 60 minutes later for $90,000 (Waldorf)
  e.g., $130,000 first bid, re-auctioned 60 minutes later for $90,000 (Waldorf)
  e.g., $57,500 first bid, re-auctioned 30 minutes later for $52,500 (2420 T St SE)
• Forget the massive audience, only a few people are fighting with you for the property
• And most properties can be picked up at a steep discount from the MLS asking price

There is an auction coming on Jan 30, just over 30 properties for sale in Washington DC. If you'd like that list, I can send it now, and expect to spend time on it in early January to flesh out the data more.

If you want to be ready, give me a call. And make sure your lender is on board with you so that your winning bid doesn’t get thrown out when you can’t finance the purchase.