I would love to hear those techniques!!! The agent hardly spent marketing dollars on it. He was sure it would sell itself. Timing is a concern. I am paying a mortgage of interest only of $4,500 a month which is eating away at any potential profit. And if the market is declining it will be worth even less. I am afraid if I wait I’ll just be in an even worse situation. I could wait until January not sure if that will make a difference as far as better time of year to sell. If I thought waiting until spring would bring a lot more $$ I guess I could wait. I’d hate to wait to find out the market only got worse.
I bought a property in Eagle Idaho, from a builder for over $120,000 below all the comps in the area. The plan was to flip and make a quick 30-40K. The realtor said he will be able to sell it before winter comes. It was on the market from August for three months and now winter is approaching. I don’t live in the area and I am moving out of the country come February. I am putting it up for auction at www.downsauction.com. The auctioneer recommended doing an absolute auction to draw more bidders (meaning it will sell to the highest bidder, no minimum). My ex-realtor thinks I have lost my mind. I haven’t even told my husband. Am I doing something completely stupid? Anyone tried this before? Anyone heard of downsauction?
Why do you want to sell it absolute? Is is just because the actioneer thinks its a good idea. Ofcourse he does. It likely means a guarantee of more money for him. Sell it with a reserve of the amount you would minimally take.
Re: Absolute Auction!!?? Need advice. - Posted by Killer Joe
Posted by Killer Joe on November 07, 2006 at 16:14:20:
Gina,
Find out the ADOM (average days on market) for your property type. Find out how your property type compares to the ADOM for the total data base. One bedroom condos will have a different ADOM than four bedroom houses, as examples. This will give you a fair indication of the demand for your property type. Also consider the price range, condos @ $400K as opposed to condos @ $300K, as examples.
Auctions are all about demand. Your chances of getting a good price at auction are dependant upon bidders who want your property over and above its liquidity price. If your property type is in demand in your market, you will see a larger group of potential bidders show up than if the property type shows little demand, or there is a glut of similar properties. The ADOM will give you a clue regarding this.
If your property is a little weak on the demand side, be prepared to see lower offers than you may want. Unless I was dumping a property, I would stay away from auctioning a property in a low demand situation. Conversely, as a buyer/bidder, you would know your competition will be less at such an auction, just as it is in the general marketplace. Not talking looky-loos here, I?m talking bonafied bidders who will create demand on the spot.
If the demand for your property type puts it on the sell-fast side of the ADOM your chances of getting a good price increases. Just like in the general marketplace. See if your Realtor can help you get a grasp on the ADOM for this property.
The decision to sell by auction should be preceded with a little bit of knowledge about the expectations regarding its draw. This is one way to help forecast the potential. HTH
CHARLES PARRISH: Absolute Auction!? Need advice - Posted by Don (VA)
Posted by Don (VA) on November 07, 2006 at 15:45:32:
I’ve changed the heading a bit to try to get Charlie Parrish to comment on this; he posts here and does auctions. The brief answer is that an absolute auction will stir up a lot more excitement than a reserve auction…but it is riskier. However, there are some techniques (within those two categories) that might work for you.
As for your ex-realtor. He/she’s the one who was so confident the property would be sold quickly? You’re stuck with the property and all the agent has lost is some marketing cost. Not sure I’d trust his/her judgment that much.
Finally, as painful as it will be, I think you’ve got to tell your husband. How much does he know…if anything? That you’ve bought the property? That you’re thinking of auctioning it? That you’re thinking of an absolute auction?
And even look at your alternatives to selling it now at auction. Is the timing right? Do you absolutely have to sell?
Believe me I wanted to do that. He said an absolute auction would bring out more bidders and would result in a higher price. One of the neighboring homes now just signed up for auction however, they are doing a reservation of price. It will be interesting to see the difference in the two auctions. I am very nervous however, the postings I’ve gotten so far from other realestate sites seem positive about selling via auction. I am expecting to take a small hit.
Thanks, sounds like good advice. The AMOD is long, hence the reason I am trying to speed it via Auction. It is a higher end house. From what I’ve learned so far talking to a couple of local investors I am hoping to get 75% of FMV. Which means I will still loose money but money I can afford. Anything less then that would be a real strain.