Real estate brokers and agents often find themselves in a situation where a real estate auction could benefit their seller client. Such as:
1. Your seller has a specific timeline in which the property must sell.
2. The listing is unique, difficult to comp or is highly desirable.
3. The listing is deteriorating and in need of repairs.
4. Listing period is about up and broker/agent needs a new approach to keep the listing.
Whatever the situation, brokers and agents should not be afraid to contact a reputable auctioneer in their area to discuss referring or joint venturing a real estate auction project.
The following are items usually asked by brokers/agents when contacting us about an auction:
How long does an auction take?
Answer - Depending on the size, value and complexity of the project, most auction marketing period are between 4 and 6 weeks. On rare occasions, longer or shorter. Closings are typically around 30 days post auction for residential and 45 days for commercial.
Can we have a reserve price?
Answer - Yes. Some auctions are with reserve and some are without. Talk with your auctioneer partner about the benefits of both.
What does an auction cost?
Answer – Most auctions consist of two costs; commission and marketing expenses. Generally speaking, in our auctions the seller will pay the marketing expenses and the buyer will pay a Buyers Premium that will cover commissions. Marketing expenses are determined based on the property and location. For example, a single family home is different than a shopping center. Talk to your auctioneer partner about local norms and/or customs.
How do I (broker/agent) get paid if my client needs auction services?
Answer – You would enter into either a referral agreement or a co-listing agreement with the auctioneer. If working on a co-listing basis, a working knowledge of the auction process and terms of sale would be required. Talk to your auctioneer partner about local norms and/or customs.
Contact Richard Kruse, SVN Gryphon Parker at 614-774-4118 or rfk@svn.com for more info.
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