In today’s unpredictable economy, selling real estate can be a frustrating process, especially in the kind of buyer’s market we are currently witnessing throughout much of Canada.
One way to quickly generate interest in a potential sale is by arranging an online real estate auction. This option is used by agents who want to entice potential buyers to the property by allowing them to place a bid, typically in real time and starting with a minimum price. Online registration is required to track items that are for sale, keep up with the bids, determine the winning bids and build a database on seller and bidder feedback.
Scott Pate, a project sales manager, says that online auctions are a way to give sellers more control over the sale because of its set timeframe.
“We’ll bring the market to this sale instead of the normal way of selling real estate, which is putting it on the market and waiting for an offer, which could take years and years,” he said.
“The market is motivated because there’s a fear of missing out. This auction is going to end on a certain day, so it creates a lot of interest.”
Many people initially think of the old, limited perception of auctions as a way to sell dilapidated homes or distressed properties. This is no longer the case.
Today, sellers choose auctions as a way to expedite desirable properties while having control over the terms of the sale. Auctions are designed to be positive events, and they are also a good way to generate competitive bidding to secure the highest possible market price.
From investment properties to luxury estates to fixer uppers and new construction, any type of real estate can be successfully sold by online auction.
Larry Weltman, customer representative at AccessEasyFunds, a commission advance company, recognizes the importance of sellers’ agents keeping up-to-date on real estate industry trends and suggests try online auctions as a different approach to landing their next sale.
“Online auctions may give sellers more certainty in a buyer’s market. Auctions offer the seller benefits because they can accelerate the sale of a property by generating additional consumer interest and activity. Advertising a property for auction creates a sense of urgency, and it brings interested parties together in a specified timeframe,” Larry Weltman explains.
Another advantage of auctioning real estate is that it requires a strategic advertising and marketing plan. In auctions, marketing is typically made up of professional brochures, online advertising, print ads, e-mail marketing and preview events, among other creative efforts.
Tom Davidoff, expert in urban economics and real estate, says online auctions aren’t all that different from the traditional route of selling homes, especially in cases where there are multiple interested buyers and a bidding war.
“It certainly could be a direction the market could go. In segments where the market is slow today, people will try different approaches to move product, so it’s certainly possible,” he says.
In addition to seller benefits, online auctions also offer advantages to the buyer who is looking to purchase a property.
Case in point, auctions can eliminate long negotiation periods. Additionally, buyers know they are competing fairly and on the same terms as all other buyers — and they also know the seller is committed to sell.
Successful auctions result in referrals and return customers, which is the end goal for any real estate agent looking to build upon their book of business.