I want to clarify another common myth or misunderstanding about selling real estate through an online auction.
Myth: If I use an online auction, I MUST sell to the highest bidder.
Truth: Most online and even "live" auctions are done using a hidden reserve or “Subject To Confirmation”. In either case, the seller is protected and not forced to sell if the bidding doesn’t get high enough. An "absolute" auction is the only auction type that requires the seller to sell at the high bid.
When an auction is marketed correctly, the process brings true market value for a property. Even in the case where that price isn't as high as the seller had hoped, you can use the online bidding process to help bring the seller to reality on what the market will pay.
Right now, I'm seeing more and more online auctions used for short-sale situations because it's a quick way to get the highest and best offer to present to the lender. The competitive bidding also presents a good case that the highest bid is "true market value".
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Thursday, February 4, 2010
Another Online Real Estate Auction Myth
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