Real Estate FAQ & Info
If I sell at auction, aren’t I giving it away
- Many people believe auction means bargain. Auctioneers understand this psychology and use it to draw large crowds of people which helps to ensure that the price is good for the seller. While there are indeed many good buying opportunities at an auction, the best articles in the world are sold at auction when pricing becomes difficult. The reason why people with very expensive items, and very modest items choose auction, is control. Through auction, the seller controls the time and terms of the sale, and virtually guarantees a marketplace by creating one if necessary. In strong real estate markets around the country you may have seen properties "listed for one price" and "sold above listing price". What happens in these situations is an auction, except that rather than being open by announcements as such to the entire marketplace, they are usually conducted between the two or three buyers that have found the listing at that time, and they make offers not knowing what the other offers are and how much they have to give to beat the other. In these cases, we think of them as listings, but really a limited auction is taking place, and it is acceptable to the seller or they would not be selling.
Why would I sell my home at auction
- Maybe you shouldn’t. If you are a seller contented with where you live, and are considering moving up if you can get the right price, you will find the real estate agent traditional listing a better vehicle to service your needs at that time. A good auction seller is a seller who is motivated to sell his or her property and is ready, willing and able to accept the highest bid for his or her property. Remember, the goal of a well-executed auction is to provide the highest possible sale price for your property in the shortest possible time period. Also, if you are the executor of an estate or control a vacant property, you are not the same seller, then the auction solution will suit you better.
What are the advantages of selling real estate at auction
- When you sell real estate at auction, you, the seller, dictate the terms of the sale. This is contrasted by traditional brokerage where the buyer dictates the terms. Here are some advantages:
- You sell your property on your time schedule, not the buyer’s. Auction marketing of real estate generally requires 4 to 6 weeks. So 4 to 6 weeks after you sign your Auction Listing Agreement, you will have your auction. Closing is then within 30 to 45 days of the auction. What this means to you is that you can plan your future more effectively and confidently and the relatively quick process will reduce your holding costs.
- Real estate auction sales are generally "as-is, where-is". What this means to you is no more "nickel and dimeing" because an inspector found this or that wrong with the house- no more disputes over condition of systems or other issues. The buyer purchases the property as they see it and as it is.
- Real estate auction contracts generally have no financing contingencies. What this means to you is you have far greater certainty of closing on an auction purchase contract than a conventional contract.
- At auction, you sell your property at the highest bid acceptable to you. You do not have to evaluate whether you left money on the table. The auction creates a competitive bidding environment. What this means to you is that you’ll have knowledge of what the market is willing to pay for your property, enabling you to make your decision to sell with certainty and confidence. The process of gathering all interested parties in one place at the same time gives you the best opportunity to obtain the highest possible price
What if I have more than one property
- Other criteria for choosing an auction over a traditional listing might include whether or not there are multiple properties. Through the auction process, more than one property can be sold in a single timeline; and if the properties are connected, you enjoy the benefits of buyers bidding on them as individual parcels, and in combinations. A dimension that is impossible to achieve in a traditional listing.
What advantages does an auction have
- The advantages are different for different sellers, but generally think of it this way. There are 3 elements of a real estate sale. The price you get, the time it takes to sell it, and the terms of the sale. In a traditional listing you don’t control any of these. You can’t predict how long it will take to sell, nor what conditions will be in the offer. You feel like you control price, but you really only control the right to say no and then keep the property. The buyer always decides the price. You merely accept or reject it. In an auction, you control both the time and terms because you set them. And the price is controlled to the same extent seen in the traditional listing with the sellers ability to say no and refuse to sell. The difference with auction is that you are going to employ an aggressive marketing campaign to generate a high degree of interest and use the competition and the professional skills of the auctioneer to drive the offer to its highest level. So the advantage of the auction is control.
How will my property be marketed
- A key advantage of auctioning real estate is the benefits of customized advertising and marketing programs. Auction marketing typically consists of print advertisements, targeted direct mail, e-mail marketing, property signs, and web listings on http://www.bidderone.com/
Can I get a good price at auction
- The truth is that whether you offer your property at auction or by traditional real estate listing, the buyer is the one who is spending the money and therefore controls the price. In both cases you have the right to refuse any offer, but you can’t spend the buyers money for them. Our experience is that some times an auction leaves you feeling that you got more, and some times a listing leaves you feeling that way. The decision to auction or not to auction should depend on criteria other than getting the most money
How often is LWBC successful in selling property as a result of the Auction
- LWBC has historically sold approximately 90% of its auction listings. Rarely does a LWBC auction purchase contract fail to proceed to closing. This contrasts with traditional real estate listing contracts, which historically have far lower success rates. And because of the absence of contingencies in a typical real estate auction contract, auction sales are more likely to close than traditional real estate contracts. What this means to you is a greater certainty of selling your property via a real estate auction listing with LWBC than via a traditional real estate listing.
What is more important than getting the most money
- Getting the most money is important, to you and to us. But you can’t sell a property through a traditional listing and the auction process at the same time, so you should look at other information to help drive the choice. Information such as "is the property currently being gainfully used by you at this time" If it is, you may want to get a certain price or otherwise remain in the property. If not, then every day the property remains unsold is a net cost against your bottom line. Costs such as utilities, taxes, insurance, maintenance, security, depreciation, and loss of return on the money invested otherwise are ongoing and mean that the longer it takes to sell, the less you ultimately put in your pocket. Another reason that you may choose auction is that you are selling the property for an estate or a friend, and you do not live close to where the property is. You are concerned about having the property on the market for an indefinite period of time while it sits vacant. An auction will give you firm control of the time line here and ensure you are able to sell it and move on. In these situations the risk of listing the property is higher than the risk of auction because you give up more in a listing.
Do I have any protection from what I feel may be too low of a price
- At our auctions we offer to do business with or without reserve. If you wish to sell without, then you must accept the best offer generated. Most of our properties however are sold with the seller having the right to accept or reject any offer. That is your protection against an unacceptable price.
How often do properties sell for less than appraised value
- This is a difficult question to answer because it suggests that listed properties typically bring their appraised price which is not true. Appraisals, while helpful in making decisions are an imperfect science. They are prediction of what a property should bring based on the best available comparable sales in the marketplace. If there are an abundance of sales of very similar properties, then the appraisal is probably an excellent prediction of price. If there are few sales of similar properties, then the appraisal may be very high or very low compared to actual sale price. This holds true in both traditionally listed properties, and for auction properties. We have sold properties for substantially more than appraisal, and for substantially less. In all cases, the seller agreed to the price, and the appraisals were in error by the amount they differed from the actual sale price.
Agent Listing Vs LWBC
- LWBC is licensed to sell Real Estate in the State of Georgia, and is a member of Georgia Multiple Listing Service. The advantages of listing a property with LWBC vs a traditional agent could be many. We provide auction services in addition to listing services. Auctions allow the seller to control the time it takes to sell, and the terms of the sale. This means that if you dictate cash on closing with no conditions, then that is the way all competitive offers will be made. Most auctions can take place within 45 days of the date of contact with the auction company.
What about estates; do they sell well at auction
- Estates are best sold at auction in our experience. While we do list them traditionally when a customer requests it, the auction in most cases will best achieve the goals of the estate. Estates are also typically attended by more people than a non- estate property. Competition is often greater, and prices better. Additionally, we can provide more services to the estate executor that fit with the real estate auction decision such as selling contents in a similar time line.
What kind of options are available to me through auction
- Real Estate auction holds many choices. These include selling live on site, live in a ballroom or office location, by fax, online, by mail, or by a combination of these methods. Auctions can take place with reserve, or without reserve. Most auction processes require the seller to pay for the cost of marketing the product while the buyer is responsible for the commission. Most real estate auctions can take place within 45 days of contact with our firm, with closing following typically in 30 days. Some properties can be sold faster, and some large properties may require a longer marketing period. Our firm offers all of these services plus traditional real estate listing services. We specialize in gaining a clear understanding of the customers needs, and then making a plan that best utilizes available technologies to best meet your goals.
What services do you supply
- We supply all one would expect in the auction business such as auctions of real estate and personal property. In addition we can also arrange for appraisal of personal property and real property if it is desired. We typically supply other services to estates such as cleaning, garbage disposal, maintenance, lawn and yard care, and anything else that may be important to an absentee executor. Our goal is to offer a turnkey solution to meet all of your estate settlement needs.
When is auction NOT recommended
- We do not recommend an auction when you are very satisfied with your home, and you want to sell it only if a certain price is met, failing which you would prefer to keep it. In the meantime you have to live somewhere, so the cost of heat, hydro, taxes, maintenance, security, insurance, etc. are a non-issue. You are enjoying the home and you have to have at least one set of living expenses somewhere. The reason we don’t advocate an auction in this situation is that an auction does cost some money for marketing in the aggressive manner typical for this method. You risk this cost whether or not you get the price you want. In a traditional listing, there is typically no marketing charge, so if the property does not sell, and you had to live somewhere, then there was no net cost to you. In this situation the auction is more risky.
Aren’t all auctioneers the same
- Doctors are not the same. Lawyers are not the same. Real Estate agents are not the same, and auctioneers are not the same. Auctioneers offer a variety of services from specialities to very general auction services. Some are high service providers, and some are lower. Some have professional training, and some do not. When hiring an auctioneer, ask if they have experience in the field you require. If you call us, and we can’t service your needs, we probably know someone who can. Also, Our company does know how a traditional sale works and offer both Auction and Traditional Sale services.
Why would I call LWBC over my local agent or auctioneer
- The one thing you can depend on from a LWBC representative is that we won’t recommend our services when someone else’s service or another method will better suit your needs. Our approach is to learn about you and determine if we can help. If we are not the best solution to your needs, we will tell you. Many service providers today are so involved with their own perspective that they simply walk in and sign you up without ever finding out who you are and what is important to you. At the end of the day, your local providers may be the best solution for you If that is the case, we will tell you. The question you need to think about is will your local provider consider your needs in as broad a spectrum as we will. LWBC’s is involved with estate settlement throughout Georgia, and we have a network of service providers for similar services throughout North America. Our approach is to take the time necessary to fully understand your needs, and recommend a process that will best suit those needs. The result for you may be the one that involves your local agent. Call us, we will help you find the best solution regardless of whether we play a direct role in it, or just pass on some free advice.
VIEW THE PROPERTY
All of the properties that we offer for sale are available for viewing at one or more pre-set open house times. The properties are available for public inspection during each open house period. If you aren’t available to view the property on any of the pre-established open house dates, we’d be pleased to arrange alternate viewing times for all qualified candidates.
REQUEST A PROPERTY INFORMATION PACKAGE
If you have some interest in bidding on a property, make sure that you get a Property Information Package from the Auction Company. Most of the Property Information is listed on the Internet, but the complete package includes more detailed information, which may include copies of contracts, disclosure statements, terms & conditions, sample bank letter, surveys, maps, etc. can be obtained at an open house, or by contacting the Auction Company to request one be mailed to you. You may not bid on a property at a LWBC Auction until you have signed that you have received, read and understand the property information package. A copy of this package will be attached to the sales/purchase contract.
DO YOUR DUE DILIGENCE
Feel free to hire a building inspector or real estate appraiser before auction day to inspect the property that you intend to bid on so you can be confident about your buying decision. We’ll make special arrangements to have your inspector study the property. Ask lots of questions before auction day about the property and or business that you intend to bid on. Acquire an understanding of the value of properties in the neighborhood, community, city or region that the property is located in. Feel free to have your lawyer review the Property Information Package. Gordon’s represents the Seller of the property exclusively. If you’d like exclusive buyer representation, you need to hire a buyer broker, or your lawyer, just like on any other regular real estate transaction.
When LWBC sells a property, it is for cash, with no conditions and typically closing in 30 days. >This means that you will not be permitted to bid on a conditional basis. You must know prior to bidding that you are pre-approved for a mortgage from a bank or other financing source, or that you have the cash in hand. If you require financing assistance, speak with a LWBC’s representative and we’ll do our best to assist you.
Once in a while when dealing with large family trusts, commercial properties and/or business, a vendor financing option is offered. If this is the case, the financing option is clearly published on all property marketing materials.
When speaking with your lender about financing, always present him/her with the complete property information package. This will have all of the pertinent information that they will require to pre-approve you, less the price. If your lender forces you to put a price on the property, tell your lender the highest amount you’d be prepared to pay for the property and see if you can get approved. If you can get approved at your highest price, then you know you can pay any number less than your approved number and perhaps just a little more, if you have to.
SPEAK WITH THE AUCTION COMPANY
Being honest with Auction Company representatives about your level of interest in the property will increase your chances of buying the property. Most properties sold by LWBC are sold subject to confirmation. Based on this premise, we sell almost every property (over 90%) that we market through the auction process. During the auction of any asset, a Seller has a price in mind of what he’d like to sell for and a Buyer has a price in mind of what he’d like to buy for. As a buyer or seller, being honest with the auction representatives will help your chances in accomplishing your goal for that auction.
UNDERSTANDING THE SELLER
As a Buyer you should understand the Seller’s level of motivation. In the case of a LWBC auction, our Sellers are always clear in their intentions to sell. At LWBC’s we select our customers carefully. Our Seller’s aren’t just giving the process a shot. Our Sellers have made substantial financial investments in the marketing effort and in preparing due diligence information for the sale. The Seller is demonstrating a higher commitment level to selling. Certainly a commitment to sell far beyond the act of hiring a local agent, driving a for sale sign in the front lawn and placing the listing in an MLS book.
REGISTER TO BID
Prior to any bids being accepted by the Auctioneer, you must be register to bid for the property. For a live auction, LWBC will require you to sign the registration form that states that you have received, read completely and understand without question the Property Information Package. You may register to bid on the property at an open house, at our offices, by fax, or in person at the registration desk just prior to the live auction.
Make sure that you have the required deposit amount on hand. Some auctions require a certified deposit with registration prior to the auction. Some auctions only require a deposit from the high bidder immediately following the auction and contract signing. Sometimes this amount needs to be certified and other times it does not. The deposit terms are always listed clearly in the Property Information Package. Make sure you read the deposit terms and ask an auction representative if you are not clear what the requirements are.
Assuming you have some understanding of the property’s value and a clear understanding of what you are prepared to pay for the property, don’t be afraid to open the bidding at the auction with a strong beginning bid. One of the hardest parts of the auction for the Auctioneer is getting the 1st bid. By being the first bidder with a strong opening bid you will command respect from the Auctioneer right from the beginning of the auction. Most people at an auction will value the property similarly. However, the buyer is the 1st person to that number on that day. Further, your strong opening bid will set the pace of the auction quickly and others bidding against you may be intimidated by your bidding strategy.
You will see bid assistants at all LWBC real estate auctions. These people are there to answer your questions during the auction and to assist you with bidding. If you are unsure where the bid is or what the auctioneer is asking for, any bid assistant can help you. Don’t be afraid of these people, they are at the auction to help you.
ENDING THE AUCTION
Following the auction, if you are the high bidder, you will immediately sign the agreements of purchase and sale and provide a deposit for the specified amount if one was not due upon registration. In a confirmation auction, if the property has not already been declared sold to you, the Seller has (typically) 24 hours to accept or reject your written offer, but the majority of the time the decisions are made immediately after the auction. With LWBC, 90% of the time the property gets sold as a result of the auction.
Real Estate - Auction vs. Listing
Why would an executor choose to auction a home, rather than just listing it
Often in an estate situation we are asked the question, “why would an executor choose to auction a home, rather than just listing it”
The answer is both complicated and yet very simple. In an estate situation, often executors live a distance away from the assets and property that need to be dealt with and / or there are multiple executors and heirs with differing goals and expectations. Often executors are very busy and emotionally attached to the assets and real estate that requires marketing and sale.
A traditional real estate company is not equipped to deal with all of the assets bundled in an estate, only the single most valuable asset; the real estate. Any real estate agent working with any company can sell your biggest most valuable asset, but leave you stranded with all of the other overwhelming issues you have to deal with inside an estate.
At LWBC’s, because we have dealt with such a high volume of estate customers, we have grown to intimately understand the needs of our estate customers, and the need and demand for a one stop estate settlement solution. Often our firm is hired to settle an estate because we are one company, offering a complete estate settlement solution.
Often assets will include valuable art, antiques, jewelry, collections, cars, boats, machinery, tools and general household items. We offer a complete turnkey Estate Settlement Solution, including property management of the residence, garbage removal and property clean up, clean the inside of the home and “stage it” ready for showing and then sell the home and contents utilizing a marketing system based on the strengths of the firm through a time defined sale by competitive bid.
We also list estate properties, but often estate homes are vacant and unattended and the family requires an expeditious sale in a known time frame, only offered by the auction method. PLUS, we liquidate the contents in the same time frame. A turn key solution to meet all your needs in a time frame set by you.
Once our “total services” contract is signed, the timeline to completion is typically 30 to 60 days. This process includes not only the firm sale of the home, but all of the services listed above and many other services also offered to our estate customers. Some estate customers choose all of our services and others choose less. But at the end of the day, we’re not just a real estate company to our estate customers, we are a partner they can depend upon to assist them to make the best decisions with the entire estate AND we’ll maximize the value of the largest single asset in the estate, the real estate. We can either conduct a time defined sale of the property (auction), and/or list it on the regular Realtor MLS system.
Call today if you think we can help you, or someone you know. The other core market we serve is seniors downsizing. Seniors, and families of seniors, downsizing from a home to an apartment or care facility often face many of the same challenges as Executors.
An Opportunity for Realtors!
Lose less expired listings! What have you got to lose by introducing the Auction Method of Marketing to a listing that is on it’s way out the door Even if you are losing a listing because it is overpriced, your client could still be a very motivated Seller.
A certain percentage of your listings could be best sold at auction (e.g., the extraordinary, the unusual, the overbuilt). Due to their unique nature, you often lose the listing before you get it sold. At auction with LWBC, there is a 90% chance of getting it sold in 30 days!
Offer an alternate solution to anxious Sellers and Executors. Use us as a tool to obtain substantial price reductions. We will help you turn seemingly unsalable properties into strong listings.
We are not asking you to endorse the Auction Method of Marketing real estate, we are asking you acknowledge that it is an alternative to the traditional methods of real estate marketing that could be suitable to some of your current and future real estate clients.
Offering the Auction Method of Marketing real estate to consumers in general will bring the most serious Buyers and Sellers to your company and provide you with a steady supply of serious and qualified Buyers and Sellers.
Our message to fellow Realtors is simple: (1) Do not let expired listings/commissions walk out the door AND (2) Let us help you turn tough properties into quick and easy commissions. Our niche company provides proven alternative solutions to selling overpriced, tough, complicated, unique, extraordinary and estate properties. We regularly sell and assist to sell residential and commercial properties in Georgia. Our Selling customers include our real estate partners, many private individuals, financial institutions, large and small corporations and all levels of government.
If you have a tough to sell property listed with a motivated Seller, or a good listing about to expire, call us and we may be able to help turn that lost listing into a commission, or a very substantial price reduction. Further, they are closed and commissions are paid in 30 days or less.
The benefits of an Auction Partnership with LWBC are measurable:
- You do not lose the listing/commission and you help solve a problem for your Vendor.
- Once the auction listing is signed, you have a great chance to earn a 3% listing commission paid to you at closing, normally within 75 days or less of signing the contract. Typically, if you register the high bidder for the auction, you’ll earn a further 2 - 2.5% commission, in addition to the 3% listing commission.
- You will assist with and be promoted throughout the open house and auction process.
- Immediately following the auction, LWBC will provide you with a detailed list of all registered bidders for the auctioned property. You will have already been exposed to these prospects at least once and possibly two or even three times through open houses, telephone conversations and on auction day. This list of prospects is significant and its’ yours to keep! All of those people who registered to bid have told you that they would like to, or are willing to, purchase a property in your market area. Further, many potential bidders are excluded from the unconditional cash only bidding process because they have another property to sell that is not yet listed for sale.
In summary, an Auction Partnership with LWBC means that you will lose less listings, you can potentially earn a substantial commission quickly, you will generate new qualified buyers and listing leads giving you the ability to earn after the sale commissions, you will gain thousands of dollars in free advertising, you will be able to add Auction Marketing experience to your listing services portfolio and you will have solved your Seller’s problem!
We happily pay commissions to our real estate auction partners.
We have developed and utilize multiple accelerated marketing strategies and techniques including Live Bid, Sealed Bid, Alternative Sealed Bid, Multi Par and On Line auction strategies. Each is based upon similar principals, however could produce different results, based on the property and the broadness or narrowness of the market for the property(s).
To arrange a personal meeting in your office, or to learn more about the details of our Auction Marketing Programs, please call LWBC. We’d be delighted to speak with you or meet with you and/or any of your Sellers. Wewould also be available to speak with you and your entire office in seminar format at any time!
Our Auction Marketing Programs are exciting and they work! Lets work together. You’ll be happy you did, and most importantly, so will your Seller.
Co-operating Agent Information
(1) If you have a client interested in a property we are selling, pre-register them with our office. LWBC’s will pay a 2 - 2.5% co-operating broker commission to any Realtor whose client buys and closes on a property listed through LWBC.
(2) By referring clients who have sold their homes through you; and who need to dispose of extra furniture, antiques, silver, crystal, paintings and other contents due to downsizing, the LWBC’s "Personal Property and Estate Assets Division " will offer you; the agent, a referral fee. All you need to do is call, or have your client call directly letting us know you referred them. This is of benefit to your client and you get paid!