Real estate auctions are a great way to sell property in an effective, efficient, and reliable way. With an accelerated timeline of selling, and omitting the process of days it sits on the market, properties can be sold when you want them sold. Costs shrink, the effort of sellers and brokers decreases and there’s no need for multiple showings of a home. It can be sold as is within minutes at a price beyond what you bargained for. Auctions are on the rise as a viable way to sell luxury homes and mansions in America.
When agents or brokers are working with their sellers, it’s important to set expectations and have a clear dialogue about the client’s goals for the auction way before the selling date. This article is meant for listing agents, auctioneers, buyer’s agents, and brokers on guiding your client’s expectations. Setting them up for success and satisfaction early on can shield them from potential curve balls or disappointments. Here’s how to prepare your client for luxury real estate auctions.
The Setup for your Client
As a real estate professional, it’s best to set yourself up for success to clearly understand your client’s goals. Are they doable and realistic? This upfront transparent dialogue should include price and sale timelines as well.
Honest conversations early on in the selling process put expectations and promises clearly on the table for everyone to see and recall when down the line things get complicated or issues arise. Because you’ve dealt with them early on in the selling stages, you’ll be more comfortable negotiating obstacles. When a seller has a better idea of the price they can expect, or what happens when a buyer backs out, it makes for a much smoother experience. So, no matter what happens, there’s an underlying respect and integrity throughout the buyer-seller-broker relationship.
Check out the Automated Valuation Model (AVM) to access public property records and create an estimate for price comparisons. This will help your client achieve a realistic selling price point. You could also invite clients to auctions and showings of properties within the same range so that they have an idea of comparable selling price tags.
The people sitting in the seats at luxury real estate auctions can range from first-time homebuyers to people with aspirations of a larger, luxurious home. Auctions aren’t just the stigmatized sector devoted to foreclosures. They’re also meant for mansions and luxury properties with big-ticket offers. Having your client up to speed on the deposits that need to be paid upfront and their remainder fees, as well as the bidding process and what that looks like step by step. Over-explaining is better than underexplaining so all the numbers can make sense when it comes to the buyer paying and the seller selling.
One of the great benefits of luxury home auctions is how fast the process goes. With financing organized in advance, approvals can be processed in the appropriate timeframe so buyers can get the home they want when they want it.
Avoiding Auction-Related Risk
Managing risk factors before they become larger issues is highly recommended. Things like price, timing, and contract terms are best understood before auction time. As a broker, ensure the vendor’s reserve price aligns with market value. Understanding the right marketing strategy is in direct correlation to selling to a happy buyer. Some ways you can temper risk in auctions include:
Preparing the property
Most auctions require home inspections prior to the bidding process. When the auction starts, and by the time it’s over, it goes fast. Inspections help the client fully understand the home conditions and the number of repairs and renovations required before selling. This way, buyers can make informed, intelligent decisions about the property.
Making disclosure agreements available
With varying disclosure laws for varying states, keep in mind that California’s disclosure laws are some of the toughest in the country. Wherever you’re operating, however, understand the bidder’s disclosure packet, aka due diligence package or bidder package, prior to the auction bidding process. Disclosures typically apply to homes sold by private sale but can help in refining the bidding process within state regulations.
Do Your Research
It is important to research the market around your property of interest as there are a number of key factors to look out for that can affect a property’s long-term value.
It’s important to research the market surrounding the luxury property and its long-term value. Knowing this ahead of time can influence the marketing appeal and promotional value. It may increase the selling price as well.
Viewing several other luxury properties with similar qualifications is a great way to ascertain the buying climate you’re working with. Understanding what similar properties have sold for and the amenities they feature can give you a clearer context for what you’re headed into.
Other factors to consider that increase the property value include educational facilities, shopping centers, noise levels, and other environmental aspects.
Preparing your client’s property for auction doesn’t have to be hard or complex. In fact, it’s simpler than traditional methods of selling and buying. With the ease and reliability of luxury auctions, you’ll know when you’re selling and that there’s more than one interested buyer in the room.
Going over your client’s expectations in regard to the sale price and timeline is critical in ensuring their overall satisfaction. It’s also best to advise them of inspections and any other processes that occur before bidding time begins. Depending on your state, you may need to look into disclosure agreements that you can review ahead of the auction date. Preparing your client’s expectations and finding a realistic number that reflects market value is a great way to be on the same page with your client.
Platinum Luxury Auctions
When it comes to real estate auctions and transactions, it can be challenging. At Platinum Luxury Auctions, we know how to simplify the process. We skip the traditional paperwork and lengthy selling processes and contingencies associated with regular sales and get down to simple selling and buying. You can expect a sale on a certain date within reasonable market value.
With numerous options for purchase and an experienced team of experts to aid you in selling your luxury home on auction, you’re in good hands. Working with Platinum means you’re dealing with luxury real estate auctions that keep the broker, seller, and buyer’s needs in mind. Always.