Property Auction Blog

With the downturn in the marketplace more and more auctioneers are getting in on the bulk ballroom auction sales. These sales are mostly impersonal but certainly effective for an institution looking to quickly dispose of hundreds of properties in one day. We have noticed that auctioneers who have traditionally performed on site auctions for a single residential property still exists.

The challenges that they face are new. No longer can a real estate investor of a single residential property buy today at one price and sell tomorrow at a higher price. So what’s the secret to success these days with this type of auction? It comes back to the same tactic that all auctioneers use right now to create a sense of urgency for buyers. That’s offering the property either at absolute auction or at a published reserve price that is just so low that any reasonable investor in the area would be foolish not to buy.

This is certainly the case for Luxury Real Estate Auctions offering 2509 Ogden St in Denver, Colorado next month. It’s a beautiful townhome built just in 2000 and is offered at a published reserve of $155,000. According to industry locals this is a slam dunk price for this property and should attract a ton of buyers to the auction sale. The auction price, of course, will determine the true market value for this property.

Auction companies have traditionally offered brokers who bring clients to an auction and “duly register” them a broker cooperation fee. This is essentially a commission to the broker/agent if their client successfully closes on the property. However, in the last few years, during the boom times, we noticed some auctioneers moving away from this practice. After all, properties were selling left and right, without any need to excite the brokerage community to come out and play.

The times have turned and we’re seeing broker co-op fees climbing: 2% seems to be the norm, however, 3% and even 4% can be found right now. And the registration process is usually a piece of cake. Fill out a 1 or 2 page form, have the broker and the buyer sign, fax it in and collect the cash! Well the buyer still needs to win the bid and close on the property, but that’s just a minor technicality-:) Auctioneers also prefer (and sometimes require) that the broker/agent be present at the auction along with their client and for good reason: usually the agent can assist the client in value, signing, etc.

The slower economy has hit the brokerage industry particularly hard. Brokers and their agents should be embracing the auction community by searching right now for residential auctions or commercial auctions for their clients and get in on the broker cooperation fees being offered!

Here are two very exciting residential auctions coming up offering a generous broker cooperation fee:
Rowell Auctions is offering over 100 properties throughout Georgia this month at online absolute and reserve auction.
Tranzon Driggers is offering 31 new homes in Ft. Myers Florida. One third of the offerings will be sold absolute.
And here are two very exciting commercial auctions coming up offering a generous broker cooperation fee:
Eddie Haynes Inc is offering an RV Park and Executive 18-Hole Par 3 Golf Course in Cedar Valley Oklahoma.
Tranzon Venuebid is offering 6 +/- AC Upland Gulf Front Land in South Padre Island, Texas.