When it comes time to sell, many homeowners wonder how they can ensure a timely sale at an ideal price. This is especially true for luxury properties, which require interest from highly qualified buyers. To achieve a timely sale, an increasing number of homeowners are exploring the luxury real estate auction process, which offers unparalleled flexibility, access to an elite buyer pool, and more.
Below, we’re discussing how luxury real estate auctions work and why they may be an ideal choice for you.
What Is a Luxury Real Estate Auction?
Luxury real estate auctions are a popular choice among homeowners who wish to sell their properties quickly while still receiving a fair value for their home. Through an auction, homeowners will be connected to qualified buyers for high-end properties; these buyers may be harder to find when following a traditional sales process.
At Elite Auctions, we only sell non-distressed luxury homes, and our listings include some of the most unique and valuable properties on the market. This attracts a pool of highly motivated bidders, which results in successful sales that satisfy both the buyer and seller.
The Luxury Real Estate Auction Process
There are two different types of real estate auctions: sheriff’s auctions and those conducted by private companies. Most often, luxury real estate auctions are run by auction firms, who work with the seller to promote the property, facilitate the auction, and complete the transaction once a buyer is secured. Luxury auction firms typically advertise their listings on their website, where potential buyers can view videos and photos and gather important information about the properties. Included in this information is the time, date, and location of the auction.
The three most common types of property auctions are:
- Minimum bid, where there is a low-point price that the auctioneer will accept.
- Absolute auction, which allows the property to go to the highest bidder, with no minimum.
- Reserve auction, which gives the seller the right to review bids before accepting or rejecting the highest offer.
Key Steps in the Luxury Real Estate Auction Process
Before selling your home at an auction, it’s important to have a solid understanding of the process. When you work with a professional auction firm, they will typically follow these key steps leading up to auction day:
- Set the auction date.
- Conduct market research, brainstorm and finalize marketing tactics, contact prospective buyers.
- Create marketing collateral, including professional photography, cinematography, copywriting, and more.
- Launch the property’s personalized website, where interested parties can view imagery and learn more about the residence.
- Schedule and facilitate home tours, open houses, and private previews.
On auction day, your listing team will assist throughout the entire process, from registering potential buyers to ensuring that bidding runs smoothly. The bidding process works similar to any other auction: First, a representative from the firm will address bidders, explaining the process as well as the terms of the sale. Then, an auctioneer will begin the auction, starting the bidding at a minimum price (if designated by the seller). Bidders will then call out their bids, with each exceeding the subsequent offer. This often creates bidder competition, which can drive up the overall price of the home. When there are no more bids, the auction ends, and the bidder with the highest offer “wins.” The entire process may only take a matter of minutes, depending on the number of bidders present.
After a buyer has been secured, you and your auction team will sit down with them to negotiate the terms of the contract, sign papers, and finalize the sale.
Do You Need Help Understanding the Luxury Real Estate Process?
If you are interested in selling a luxury property, Elite Auctions can help. Our team will work with you to strategize, promote, and run your upcoming real estate auction to help you sell your home quickly and for the best possible price.
For more information about luxury real estate auctions, contact us today.