Traditional vs. Auction Method: Why People are Choosing the Latter

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March 11, 2017
Traditional vs. Auction Method: Why People are Choosing the Latter

Traditional vs. Auction Method: Why People are Choosing the Latter

  Many sellers don’t realize that they have a choice when it comes to selling their property. While most of us automatically consider listing our home or property via the traditional method, there is another option out there for those who may want to sell for more money and a lot faster. United Country Real Estate office owner and auctioneer in Floyd, Va., Matt Gallimore, has increased his business in the last couple of years by double digits. A majority of the increase has come from auction real estate sales. He said more and more people are choosing the auction method to sell their property for a variety of reasons:
  1. There’s no cap. At list price, there’s a chance you can leave money on the table if you don’t do diligence right. Auctions bring market value.
  2. The timeline is right. It creates a buyer urgency because it has a deadline. Normally, it is 45 days from start to finish.
  3. It creates competition. As Gallimore puts it, “I’ve had people come to an auction who were looking to buy another property that was similar, but they wanted to see what happened at the auction first.”
  4. It’s a cash deal. People have to put down earnest money at an auction. The earnest money also makes it more binding than a traditional real estate contract that is easy to back out of. That’s attractive to a seller.
  5. There are options within options. When you’re selling your property at auction, you can sell your land in one or in multiple tracts. There are also three different auction types: absolute auction, minimum bid auction and reserve auction. You are able to decide which fits your situation best.
There are disqualifications for auctions. Those disqualifications include: an unrealistic expectation of their property worth, if the property isn’t currently in demand and if the seller owes a lot of money on the property. Ultimately, auctions can help you sell your property faster and for its current worth. It also reduces friction that may exist between buyers and sellers. Gallimore said when he sits down with a potential seller, he always decides if they are an auction candidate and talks to them about their options. “If they are an auction candidate, I tell them about going the auction route,” said Gallimore. “There’s advantages and disadvantages. I always say it’s the most aggressive form of real estate marketing that I know of. It creates maximum exposure for a property solely from the word ‘auction’. People really start talking about it and it accelerates the whole process.” If you’re interested in learning more about auctions or finding out if you are a candidate for the auction process, visit www.UCAuctionServices.com.