Real Estate Auction Blog

Tonight witnessed the inaugural auction of newly launched ibidcondo.com - an online real estate auction company.  Star Riverside unit #104 sold tonight for $86,840 by online real estate auction. The list price was $690,000. There was NO reserve. Bidders had to pay a $100 seat fee to participate.  The seat fee covers the sellers cost of the property.  The bulk of the auction proceeds is donated to a charity of Buyer's choosing.

I bought a seat and bid in the auction.  It lasted 25 minutes. The first 5 minutes took forever for the price to get higher because the bid increment was only $10. After 5 minutes, the bid increment increased to $100. And in the final 10 minutes, the bid increment was $1,000.  I lost out by $2,000.  The buyer has 48 hours to sign the sales contract and pay cash.

The company has posted its upcoming auctions for other units in the same complex - to be built early 2010. This is a tremendous opportunity/deal - even a "steal" I'd add.

Linda Mardi
AuctionFirst.com

Sellers Pay Attention:

Most people think that auction buyers are all investors, but that's not true.  Seventy percent (70%) of the residential real estate that we sell at auction are bought by end users.  Even in today's market, we see the end users buying at auction.  

HOWEVER, the property always stands on its own at the end of the day.  Real estate auctioneers specialize in accelerated marketing, have a big budget to work with, and target likely buyer pools. It's not unusual for an auction marketing plan to require 200 - 300 hours over 4 to 6 week period to execute the plan! Lots of work.

OK - that's all background information for this next part:

In today's Austin real estate market, buyers want ready-to-move-into upgraded/blinged out homes. It is easier to find an end user buyer for a really great home than it is to find for a fixer-upper.  Buyers are willing to pay more if the home has more features, upgrades, bling, etc.

Case in point:

I recently auctioned a 5,000 sf executive home in an upscale neighborhood that sits on an awesome part of an award-winning golf course.  We spent 4 weeks marketing the property aggressively.  Many real estate agents work this subdivision. The market has slowed significantly, however there are still sales going on. Rate reductions - a bit. What I really saw during this marketing period is that buyers weren't looking for a "deal" as much as they are looking for their dream home with all of the bells and whistles.  They are going to carry only one mortgage, live in one home - so they want that home to have everything ready to go. No fixing up.

I recently had lunch with a broker friend who works the SO-CO area. He confirmed that his nicer/prettier listings are selling much faster than his fixer-uppers or ugly properties.

If you are selling your home, this is good and bad news.  Because the question is - how much $ do you put into getting your home ready to sell?  I've always advised clients of a 2x1 rules.  Spend only when you know that you'll get $2 back for every $1 you put in.  But in today's market, you may need to spend that $1 in order to sell the property even if that means your $1 gets 50 cents.  The fact is, that those improvement in today's market are your ticket to entry to sell. Make wise choices, consult or hire an expert to advise you on what needs to be done, stay away from too much personal taste, go with decisions that have more general and broad appeal.

Linda Mardi
AuctionFirst.com - Accelerated marketing of real estate thru auction.

I attended today's auction of 19 Brazos Condos in Austin TX.  Real estate auction company Kennedy Wilson today auctioned 19 units in under 2 hours.  Although all of the units had very low starting bids, the auctioneer explained at the begining of the auction that the units had unpublished reserves and that to win the bid, the highest bid had to meet or exceed the unpublished reserves.

The auction was extremely well attended, with over 200 packed into the Hilton downtown hotel ballroom. It appeared that many of the bidders had pre-registered with the company - streamlining their entrance into the ballroom.  Only registered bidders were allowed inside.

The auction itself was well paced. The auctioneer did a great job of explaining how the bidding would work and how he would gradually lower the increments, from $25,000 down to not less than $1,000.  The bid assistants also did a great job of maintaining lively interest and tracking the various bidders with loud "yeps" as someone bid a higher increment.

As the bidding proceeded, the auctioneer would announce when the unpublished reserve had been met and that the unit would then be sold to the highest bidder, no longer subject to seller's confirmation.  All but one unit was announced sold. There was only one unit that did not meet the reserve and was sold subject to seller's confirmation.

This was a great auction to watch!  However, as a real estate auctioneer myself, I can tell you that the critical and most important aspect of the auction is the marketing program.  This auction was well marketed - read about it, heard about everywhere - plus it gots tons of tv news and media exposure.  Additionally, the auction company and builder were able to maintain a sales office open 7 days a week with models available to walk thru. This auction had great participation for several reasons:  (1) well marketed; (2) great product; and (3) minimum bids, even though meaningless, help grab attention; and (4) extremely well executed auction logistics/strategy.

What a great way to buy!  Terms and conditions were transparent, the only thing the buyer needed to do was figure out how much he/she wanted to pay maximum, figure out their financing, and then get a $2500 certified check per property they wanted to buy.  A 4% buyers  premium will be added to each high bid to total the sales price. Buyers have 30 days to close escrow.  Final sales prices were between 20-40% less than the last sales price.

What a great way to sell!  Auctions present an ideal opportunity for builders, especially condo builders who have financing considerations tied to the number of unsold units remaining.

I've traveled the country attending real estate auctions from some of the best auction companies. This was my first Kennedy-Wilson auction - a California based company that holds real estate auctions across the country. I was impressed with Wilson-Kennedy's auction logistics today. Their auction team and staff appeared top notch and experienced.  The auctioneer did a fabulous job! So often, I'm embarrassed by what I find to be old-school auctioneers that engage in non-appreciated humor or just a bit too much 'country' inappropriate for more upscale / commercial property auctions. Registration flowed smoothly, thanks in large part to pre-registration packets available, and the contract signing room also appeared to run smoothly, with Heritage Title assisting with contracts.

Linda Mardi, Auctioneer/Broker/Attorney
www.AuctionFirst.com
Specializing in accelerated marketing of real estate sales thru auction. Sell your property in 30 days - ask us how.

AUSTIN TEXAS -

Great media coverage in what was Home Auction Live!'s inaugural auction for Austin Texas. The below link is to coverage from Austin TV news KXAN who brought their news crew to cover the auction.  In all, over 16 properties were offered for sale at the auction, about 120 in attendance. 10 of the properties were referred by local realtors who either referred the properties or co-brokered wtih Home Auction Live.  Also is a link to Friday's pre-auction coverage by Olga Campos of KVUE.

http://www.kxan.com/Global/story.asp?S=7951131
http://www.kvue.com/news/local/stories/022808kvuehomeauctions-cb.7ba35be.html

Linda Mardi, AuctionFirst

Austin Top Producer Launches Monthly Real Estate Auction
Home Auction Live! Unites Motivated Sellers and Eager Buyers

February 8, 2008 (Austin, TX) - Central Texans now have a fresh, new way to buy and sell real estate. With Home Auction Live!, Austin's new real estate business, property owners can sell their homes quickly and at a fair-market price because buyers compete for the purchase on price alone.

Beginning on March 1^st, Home Auction Live! will hold their monthly real estate auctions. Buyers will be able to choose from single family homes, newly constructed homes, condos, commercial properties and development lots and acreage. Sellers will enjoy having their properties marketed to a large pool of willing buyers, resulting in quicker-than-usual home sales. Additionally, Home Auction Live is real estate agent-friendly.

Launched by Robert Grunnah of Castle Hill Properties, Home Auction Live! connects motivated sellers and eager buyers to buy and sell real estate in a fair, fast, and transparent way-assuring everyone gets a fair deal. Grunnah explains, "Sellers can look forward to accelerated and aggressive marketing of their home, fair market value offers, and a quick closing. Buyers will be able to choose from a wide inventory of homes, in every price range, with motivated sellers. Everybody wins!"

Robert Grunnah is a leader in the Austin, Texas real estate scene. According to Austin Business Journal, he was ranked as Austin's #3 top producer for 2006, with $50M+ in average annual sales. Grunnah created Home Auction Live! in response to a real need he saw in the area. "Auctions aren't just for run-down properties anymore...home auctions are perfect for even pristine homes with sellers who would like to sell their homes quickly for a fair price...where time is money and they don't have time or money to waste," he explained. In fact, the National Association of Realtors projects that 35% of all real estate sold in the U.S. over the next several years will be done so through auctions instead of conventional real estate marketing.

Home Auction Live! can bring a market value offer in as little as thirty days by investing heavily in marketing properties to gather up prospective buyers and holding monthly auctions. Home Auctions Live! allows the open market to determine the fair selling price of homes.

Home Auction Live! is currently accepting consignments into its first auction, taking place on March 1^st, 2008, at the Hyatt Regency Hotel on Town Lake in Austin. A limited number of property slots are available on a first come, first served basis. For more information, contact Robert Grunnah at Robert@homeauctionlive.com

A new company launched this month in Austin Texas - Home Auction Live.   Home Auction Live is a primarily residential real esate aution marketing company that has announced it will hold monthly real estate auctions in Austin Texas serving property owners who want an expedient way to sell while retaining the highest possible sales price.

The first auction is scheduled for Saturday March 1st at the Hyatt Regency in Austin TX. Registration starts at 9am; and the auction at 10a  Remote and online bidding will be available thru NAA Live. Don's miss this exciting first auction launch.

www.HomeAuctionLive.com

Linda Mardi
AuctionFirst.com

I had an ebay auction last year - sold about 9 designer outfits in one lot. High bidder was $1. Best auction she ever won - her comments, not mine. But I'd have to agree.

What about real estate?

When I talk with sellers about reserves and their needing to set a very very low or no reserve. A common comment is "but what if no one bids more than $1?"

What would your response be if this was to be a no reserve auction?  (I'll tell you my comments in part 2).

Linda
AuctionFirst.com
Real Estate Auctioneer