Are real estate auctions only for distressed property?
This is a major misconception about auctions. The fact is auctions are the primary sales method when selling valuable assets such as vintage vehicles, multi-million dollar homes, and priceless piece of art.
Why sell at auction?
Auctions are the perfect answer when you need to accelerate the timeline for selling your assets. Auctions help reduce holding costs and determine the market price of an asset when the value is unknown or when comparable pricing is unavailable.
Aren't auctioned properties sold at a discount?
The competitive bidding of an auction and the bidding of prospective bidders sets the price and market value of an asset. The property will not sell for more than the highest bid and will not sell for less than the high bid. The bidders determine the market value of the property when you buy at auction.
What is an "Absolute Auction"?
There are different types of auctions (i.e. Reserve, Minimum Bid, etc.). An "absolute auction" is an auction where the property is sold to the highest bidder. Unlike a reserve auction, there is not a reserve price that must be met to complete the auction sale.
What is an "Auction with a Reserve"?
A "reserve" auction means that a price has been set between the seller and the auctioneer that must be met to complete the sale. Reserves are often used to provide the seller with security that they receive a certain amount of money to meet their sale goal.
What does "Minimum Bid" mean?
Minimum bids are routinely used at auctions to provide prospective buyers with an initial price range of where bidding will begin. If an auction has a "minimum bid" of $50,000; prospective bidders will know that the auction will start with an opening bid of $50,000 and that the asset will not sell for anything less than $50,000. Often, auctions are advertised with an "opening bid", this should not be confused with a "minimum bid". An "opening bid" simply means a price where the bidding opens.
What is a "buyer's premium"?
A "buyer's premium" is commonly used in auctions today as a form of payment for the auction company conducting the auction. The "buyer's premium" is an advertised percentae of the high bid or flat fee added on to the high bid to determine the total contract price to be paid by the buyer.
What does "As Is, Where Is" mean?
One of the most common statements made at auction, "as is, where is" simply means the property is being sold without warranty and that there are no contingencies based on the status of the asset being sold.
What is the auctioneer really saying?
The auctioneer's chant is a sequence of increasing numbers and "filler words". The auctioneer's chant is simply a statement followed by a question. For example: I have 100 dollars. Would you bid 200?
Who's the person yelling in the audience at an auction?
The person you see and hear working amongst the crowd of bidders is known as a 'ringman'. This individual is part of the auction team and is an extension of the auctioneer. The job of the 'ringman' is to convey bids back to the auctioneer from the crowd. When bids are received in the crowd, the 'ringman' will yell to signal the auctioneer that they have received a bid and to increase the bid amount. These individuals are also there to help answer questions you may have while the auction is being conducted.
Can I attend the auction and participate as a spectator and not bid?
Absolutely! We encourage people to explore auctions by attending as a spectator. There is no better way to learn about auctions than to watch one firsthand.
Can interested parties inspect the property before the auction?
We encourage all interested parties to view the property before auction day. Due diligence on the part of the bidder is important with auctions. Auctioneers want you and all interested parties to feel comfortable on auction day.
Who are we?
Joe Setton, Auctioneer and Setton Realty have been practicing residential and commercial Real Estate in the Lehigh Valley for almost 30 years. With our knowledge and experience and the aid of our professional staff, we guarantee your satisfaction.
Always feel free to call and ask questions.
610-821-1212 or 610-730-5510
Joe Setton, Auctioneer