Traditional Sale versus Auction
Traditional Headwinds
Traditional Headwinds
Traditional Headwinds
With growing inventory and higher interest rates, home sales are facing significant challenges for traditional sellers and buyers. Sellers are withdrawing in record numbers, which impacts the overall market dynamics, including various auction types that could provide alternative selling options. The average closing price is almost 10 perc
With growing inventory and higher interest rates, home sales are facing significant challenges for traditional sellers and buyers. Sellers are withdrawing in record numbers, which impacts the overall market dynamics, including various auction types that could provide alternative selling options. The average closing price is almost 10 percent lower than the original listing price, highlighting the importance of understanding the real estate auction process as a viable strategy. Homes are spending more days on the market, and buyers are increasingly seeking—and obtaining—more seller-paid closing concessions and costly repairs, further emphasizing the property auction benefits in the current climate.
Auction Alternative
Traditional Headwinds
Traditional Headwinds
Auction properties, part of various auction types, disclose upfront details and sell with zero buyer contingencies, repairs, or contract requests. The real estate auction process establishes the sales timeline, from marketing to closing. Auctions bring certainty and attract the largest buyer pool for the property, ensuring that competitive bidding secures the maximum price available.
Property Auctions: Understanding the Process and Benefits
1. We meet to determine the best auction types and sales method for your property.
2. A listing agreement is signed using a promulgated contract from the Texas Real Estate Commission, allowing the property to be listed on the Multiple Listing Service platform with the agreed listing price.
3. If the property is already listed, that listing agreement remains in effect with your agent, who will assist with the showing and closing of the property.
The next two weeks are preparation time:
1. Photographing and preparing the property marketing for MLS to highlight the property auction benefits.
2. Conducting third-party inspections of the structures and systems, including a full home inspection, onsite sewer (if applicable), Wood Destroying Insect (WDI) inspection, well (if applicable), sprinklers, etc.
3. Obtaining a seller-paid survey if an existing one performed within the last 10 years is not available or no longer accurately depicts the property.
4. Completing all seller disclosures, plus obtaining other relevant disclosures and information, including HOA, MUD, PID, water district, and any other relevant oversight.
5. Opening title and securing title commitment.
Exposure Period:
The property is listed on governing MLS platforms and public sites with auction disclosure, including open house dates with the agreed listing price. Buyers tour the property and submit pre-bids for seller review before the property officially goes to auction. Since the seller can still withdraw from the process, bidders are incentivized to submit a bid early for 50% off the buyer’s premium.
Decision Time:
At the end of the exposure period, the seller and auctioneer review the results. Once the seller gives the okay to proceed, the auction paperwork is signed, and the property price is adjusted on MLS to reflect the highest bid already received. The auction closes on its set date, and the property goes through the normal closing process, approximately 30 days.
Personal Property/Livestock Option
Completed before the home auction and can add approx. 60 days.
Experience Portfolio Auctions LLC
Our Commitment
At Portfolio Auctions LLC, we are committed to providing a fair and transparent auction process that encompasses various auction types. We believe in creating a positive experience for all participants, whether they are buyers or sellers, by highlighting the property auction benefits and ensuring clarity throughout the real estate auction process.
Auction Types
In addition to real estate, sellers can explore various auction types, including the option to auction personal property and livestock. Each auction is curated to meet the needs of our clients and their unique items. The benefits of a property auction extend beyond just real estate, as our personal property and livestock auctions are offered only in conjunction with the sale of real estate, utilizing either the traditional listing or the real estate auction process.
Personal Property and Livestock
Sellers can expect that the auction of personal property will significantly extend the real estate auction process, as the items must be tagged, photographed, and cataloged. The marketing time allotted will depend on the complexity and volume of the auction types involved. Additionally, extra time will be necessary for buyer pickup and preparing the real estate for photography and marketing, highlighting the property auction benefits for both sellers and buyers.
Is Your Property Suited For Auction?
The auction process works best for the following real estate
1. The property is a bespoke or truly unique home, making it difficult to find market comparables for appraisal. This uniqueness often leads to favorable property auction benefits.
2. The property is not leveraged more than 40 percent of its estimated value, which is a crucial factor in the real estate auction process.
3. This includes vineyard, farm, and ranch properties, which have their own specific auction types.
4. Large unimproved acreage can also be appealing in the auction market.
5. Inherited residential estates, regardless of size and location, are often sought after in property auctions.
6. Builder residential inventory is another category that frequently enters the auction types, providing investors with various options.
