If you are a listing agent, did you know that you're already running an auction? It's called a painfully slow Dutch auction. A Dutch auction is when an auction starts with a high price, and the bid decreases until someone accepts the price. Maybe that's a tad over-simplified, but you get my point, don't you? The way the vast majority of real estate is sold in this country simply amounts to a modified Dutch auction taking place at an incredibly slow pace. We (Realtors) list properties for sale at (ideally) or above (more commonly) fair market value and then reduce the price until somebody comes along and makes an acceptable offer.
I think a better way is to list the home for 10% -15% below market value and hold an online auction. The competitive listing price will garner a ton of interest (and potential bidders), and the auction will enable those bidders to compete for the home with the winning bid ending up at true market value. The beauty of the auction, is that you are placing a time constraint and forcing those interested parties to make an offer. This way, you can re-create a "mini 2005".
You remember 2005 don't you? When you listed a home and on day one it was shown 10 times, and on day two you had five offers on the table? (all of which were above the listed price). Aaaahh yes, those were the good ol' days. But that is exactly what you can create by utilizing this method. You are creating your own little "micro-economy" where demand is higher than supply, and thus the price must rise.
Some are starting to catch on, but the real forward thinkers need to get on board. Any thoughts?
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