Expert advice: Selling a house at auction

If you’re thinking of selling your house at auction, you will need to consider the positives and negatives of choosing this selling method. When you sell at auction, you’ll have a set time to market your home and a set date for the sale of your property. An auction can also generate a great deal of excitement and competition if there are many people interested in your property. But there’s no guarantee that your home will sell for the amount you desire. So here are seven tips to help you increase your chances of success.

1. Find a good real estate agent

Look for an agent who has a proven track record for auctions in your local area. You can compare agents by asking for their results from recent auctions. Have a look at the number of properties that were sold successfully, ie the reserve amount was met. Or you could consider attending an agent’s auctions to get an idea of how your own auction would be handled. You might also want to consider things like the agent’s experience, reputation, negotiation skills, and strategic approach to marketing.

What’s more, you can compare real estate agent fees and commissions to help you choose the right agent. Fees and commissions vary depending on which state or city you live in, but it generally includes negotiating and marketing fees, and the commission is usually between 1% and 5% of your property’s final sale price.

2. Create an advertising budget

According to data obtained by LocalAgentFinder, most real estate agencies will charge between $1,000 to $5,000 on marketing costs for a typical individual property, with the majority trending towards a budget under $2,000. Many homes sold by auction are usually scheduled to sell after 30 days. By creating an advertising budget that’ll last for this time period or more, you’ll be able to advertise your home up until auction day. The point is to let buyers know that your home is on the market. And when you have the funds on hand, you can quickly generate interest in your upcoming auction from the start and continue to attract potential buyers until your home’s ready for sale.

3. Hold open house inspections

Another way to attract a lot of qualified and interested buyers to your auction is to conduct open house inspections. Since you only have a limited time to market your home, you need to showcase its best features. Most importantly, the house should be prepared for sale with styling and presentation and an have a strong deep clean before the openings. Here is a list of essentials to prepare your house for the inspections.

4. Pay attention to feedback

If your agent gives you buyer feedback from the open house inspections and inquiries, take these comments into consideration when presenting your property in the future and setting your reserve price. After all, when you cater to the needs and wants of buyers, you’ll have a higher chance of achieving a strong sale price.

5. Choose a realistic reserve price

You should set a reserve price that’s based on recent comparable property sales. You’ll need to compare the asking price of homes similar to yours and the price they sold for, and then decide on a reserve amount. Keep in mind that only you, your agent, and the auctioneer should know about your reserve price before auction day.

6. Be present on auction day

It’s best to be present on the day your property goes under the hammer. By directly observing the auction process and buyer interest in your property, you’ll be able to make better, more informed decisions in any negotiation after the auction.

7. Negotiate or run another auction when your home is passed in

If your reserve price is reached at auction, your property is considered to be on the market and is sold to the highest bidder. But if your reserve price isn’t met and your property is passed in, you can negotiate with the highest bidder or run an auction again on another day and get a great result.

By keeping these tips in mind, you can improve the likelihood of a successful auction.