Legacy Auction Services hopes to help you educate yourself about auctions. This content has been condensed and modified from the National Auctioneers Association and the National Association of Realtors.
What is it that makes live auctions so addictive? Why do people come once and then keep coming back? Why should you join them?
Live auctions are fun
Whether you come to look at the goods, bid, or just watch the action, there’s nothing quite like a live auction. Maybe it’s the buzz of electricity generated by a combination of competition and the thrill of the hunt. Or the awe-inspiring auctioneer’s chant that always seems to amaze kids and adults alike. Regardless of the reason, people just always seem to enjoy themselves.
You can find incredible values
Sure, there are the fabled tales like the man who bid $10 for a dresser and found an original copy of the Declaration of Independence inside. But it’s the everyday values that are the real story behind the auctions’ popularity. Whether you’re looking for your next antique or the house to put it in, there’s no place like a live auction to get a great deal.
You can discover unique items
Some people go searching for them. Others stumble upon them while looking for something else. But either way, it’s safe to say there are thousands upon thousands of one-of-a-kind items at auctions. It’s the items you won’t ever find in some suburban strip mall, never knew you wanted, and suddenly can’t live without.
Once you’ve found a live auction, make sure you’re familiar with some of the terms you might hear there and learn how to buy and sell like you’ve been doing it for years. Never hesitate to ask your auctioneer or their staff any questions prior to bidding.
It is important to dispel a couple of myths related to auctions. Auctions are a CHOICE for today’s buyers and sellers. They are not a “last option.” Many people think that auctions are only held when someone has died or has had their property, such as their home or car, repossessed. The reasons for auctions are as varied as the materials and possessions sold there.
Another myth is that you have to be an “experienced” auction goer to buy and sell. Everyone is welcome and the auctioneers are traditionally great about helping first-timers to understand how auctions work, how to make a bid, etc. Understanding the chant is what some people find the most intimidating. Auctioneer chants are as diverse as the auctions themselves. Listen closely and, again, speak to the auctioneer prior to the auction to dispel any anxiety you may have.
WHY SELL AT AUCTION?
Auctions are the most unique and valuable way of selling almost any type of personal property. Some of the most popular auctions are those that involve household items, automobiles or antiques.
But auctions involve so many more possessions: storage units, office and restaurant equipment, art, machinery, industrial equipment, electronics and much more. One very rapidly growing area is real estate. More and more people are buying and selling their homes and land by the auction method.
People are flocking to auctions
Auctions are one of the oldest forms of selling the property. Their history spans centuries and time has only increased their popularity. A research study commissioned by the National Auctioneers Association shows that auctioneering is an industry on the rise.
More than half of the total U.S. population has attended a live auction! In 2004, the value of all goods and services sold at live auction in the U.S. was approximately $202.7 billion. This figure is up 6.8% over 2003 and translates into a huge number of satisfied buyers and sellers of goods.
So how can auctions benefit you, as a seller? Why are they the best way to sell property? Well, there are a number of reasons, including:
Quick process and turnaround
An auction is immediate. It happens during a set time and is completed during that time. It’s quick and efficient.
Control over the date and time of the sale
It’s as simple as that. You work with the auction firm to schedule what works best for you. You know exactly when your property or goods will be sold. There’s no wondering whether or not your property will sell. It WILL sell and it will sell during the set auction time.
Comprehensive marketing of your goods
Part of conducting an auction is marketing it to the general public to get as many people there as possible. Auctioneers have comprehensive mailing lists they use to market their sales. They run advertisements, distribute fliers and more. They are marketing specialists.
Buyers come prepared to buy with no negotiations
Auction goers come with money in their wallets, pockets and hands and are prepared to come home with property. It’s a seller’s delight. For real estate auctions this is especially advantageous because buyers must often qualify to buy through a deposit of a certified or cashier’s check.
There is no haggling over price or merchandise. The auction method is quick and efficient. When people bid, they make a commitment to buy the property at that price without discussion or debate.
Auctions motivate buyers to perform. People often get caught up in the competitiveness of the bidding and many times this drives the price of items higher. To some it’s like a game, and they want to win at all costs. 9 times out of 10, an auction brings in the fair market value, if not more, for any item put across the auction block!
There’s no more exciting atmosphere than an auction. Crowds of people competing for property combined with that lively auction chant makes for some great entertainment and fun.
Auctions work well in all economic climates
People love auctions because they love sales. Statistics show that auctions remain a steady force in good and bad economies alike. When the economy is bad, the auction industry does not feel the impact as people still flock to auctions.Return to top
WHY BUY AT AUCTION?
Here are some of the reasons why consumers love attending auctions according to as study completed by the National Auctioneers Association:
- 83% think auctions are an exciting way to get good deals
- 51% think they offer a great value on items
- 65% think auctions offer exciting items they wouldn’t otherwise purchase
- 53% like the excitement of getting a good price
So what’s so special about auctions? And what’s the advantage of buying at auction? Well, there are plenty of advantages.
There’s no doubt that an auction is the fastest sales process around. It’s quick and efficient and that’s what makes it attractive. A multitude of items can be sold in a very short time at auction.
You set your own price and establish a value
You are in control at an auction. You decide when to bid and how much to bid. You establish what an item is worth to you.
Opportunity for good value
With the wide array of items up for bid, there’s always an opportunity to get a good deal. Sometimes it’s a matter of just wearing down those other bidders.
Fun and excitement
There’s no doubt that an auction is entertainment at its finest. Crowds of people competing for unique property, combined with that lively and rhythmic auction chant make for some great entertainment and fun. It’s an event the whole family can enjoy.
Honesty of the transaction
Auctions are very organized and the rules are straightforward. Auctioneers who are members of the National Auctioneers Association, as I am, are bound by a code of ethics that protects consumers against unfair auction practices.
REAL ESTATE AUCTIONS
A real estate auction is an innovative and effective method of selling real estate. It is an intense, accelerated real estate marketing process that involves the public sale of any property — most certainly including those that are non-distressed — through open cry, competitive bidding. The real estate auction is a win-win proposition for everyone involved.
BENEFITS TO THE SELLER:
- Buyers come prepared to buy
- Quick disposal reduces long-term carrying costs, including taxes & maintenance
- Assurance that property will be sold at true market value
- Exposes the property to a large number of pre-qualified prospects
- Accelerates the sale
- Creates competition among buyers – auction price can exceed the price of a negotiated sale
- Requires potential buyers to pre-qualify for financing
- The seller knows exactly when the property will sell
- Eliminates numerous and unscheduled showings
- Takes the seller out of the negotiation process
- Ensures an aggressive marketing program that increases interest and visibility
BENEFITS TO THE BUYER:
- Smart investments are made as properties are usually purchased at fair market value through competitive bidding
- The buyer knows the seller is committed to sell
- In multi-property auctions the buyer sees many offerings in the same place at the same time
- Buyers determine the purchase price
- Auctions eliminate long negotiation periods
- Auctions reduce time to purchase property
- Purchasing and closing dates are known
- Buyers know they are competing fairly and on the same terms as all other buyers
- Buyers receive comprehensive information on property via due diligence packet