Re: Anyone sold a property at auction recently? - Posted by Ron M (WA)
Posted by Ron M (WA) on January 15, 2009 at 09:08:52:
This lack of emotion that you speak of could be why this hasnâ??t been effective on traditional sales with non-motivated sellers so far. It is however, working pretty well on distressed properties that I am representing as a Realtor in Eastern Washington State.
For example, I have a 2,800 sq.ft home on 10 acres in an outlying area. No one was even looking at it because of its location, condition, etc. Loan balance is $235K and the really the condition of the home is deplorable. I started the bidding in the local MLS and internet sites at $130,000 and within a relatively short period of time had a $130,000 offer.
I changed the starting bid to $135,000 while waiting for the bank to review the short sale package, and got 2 more offers. I used a round robin bidding system by telephone with all 3 agents and currently have the bid at $150,000 with the bidding still going between 2 of the parties. If it stops at $150,000, I am $20K more likely to get a bank acceptance and I have a history to show the lender as to how the offer was arrived at.
I will continue to accept offers on the property at $151,000 or better until the lender agrees to accept the short sale or counters the offer with a price of their own. I am hoping to drive the price up another $30,000 before then. I think using the round-robin brought the emotion back into the deal, but giving each bidder a day or so to think about it also keeps them thinking logically so that they are less likely to walk-away, before the lender signs off, if they win the bid.
When selling a home on a short-sale as a Realtor, it is common for the buyersâ?? to withdraw before the bank agrees to the deal. My goal here is to stop the foreclosure, give the buyer a good deal and get paid for doing it; getting the best offer possible for the lender is likely the best way of doing that on a rural out of the way property that I donâ??t think anyone would show up to for a quick auction, let alone bring cashiers checks.
Thanks Michaela for your thoughts. I am definitely looking for ways to improve the system so that it will work effectively with more traditional retails sales if you have any ideas. I have actually considered running a more traditional type of auction or using the “5 day sale” system at the end of the process that I am using now.
Ron M (Spokane, WA)