Selling a Home at Auction: Pros, Cons, and How to Get Started
Once you’ve made the decision to sell your house, you likely have two main goals: to complete the sale as quickly as possible and to hit that magic number when it comes to price. Some sellers are lucky enough to accomplish those objectives by listing their homes on the open market — but when time is of the essence, alternate methods may come into play. One way to expedite the process is to sell your house at auction.
If you’re considering whether selling a home at auction is the right choice for you, the first step is to gather the information you need to chart your course. What are the steps involved? What are the pros and cons of selling at auction? What are some other time-saving routes? And do you still need a real estate agent if you decide to take your home to auction? In this guide, you’ll find the answers to all of these questions and more.
What’s the appeal of selling a home at auction?
In a word, speed.
Eli Pasternak, the founder of Liberty House Buying Group in Miami, Florida, says the main reason homeowners sell their properties at auctions is that they can get deals done quicker rather than relying on a real estate agent. “Experienced investors and developers are often present at these trade-offs, making it easier to deal with problem properties,” he says.
Mike McClung, a home construction expert in Knoxville, Tennessee, notes that many of the homes that go to auction are foreclosed properties. “These individuals steer clear of traditional listings, as it helps them reach a different type of niche,” he says.
The National Association of Realtors® agrees that auctions can accelerate a sale, in addition to offering these key benefits for sellers:
Higher visibility among pre-qualified, prepared buyers who are ready to buy
Greater competition among buyers, which can lead to a sale price higher than market value
Reduction of long-term carrying costs, such as property taxes and ongoing maintenance
No need for staging, showings or open houses
Elimination of stressful negotiation processes
No uncertainty about when the home will sell
There is a greater sense of transparency throughout the process, notes Anthony Minniti, a professional home-buyer in Tyler, Texas. “The best part is that since bids are made publicly, sellers are always aware of the offers they receive,” he explains. “In fact, sellers can specify a minimum threshold amount to ensure that they don’t finalize a deal below the property’s actual market value.”
