One other quick way to sell a property is through a house auction. Usually, the house is put up for auction with a date 2-4 weeks out, with an advertised reserve price set at 70% of fair market value. Then, the auctioneer charges the seller a 5-10% initial marketing and advertising fee. About a month later, they will hold the house auction – normally it’s a “Closed bid” auction where bids are due by the end of the auction day. Throughout the pre-auction marketing time, a number of open houses are held in which possible buyers can look at the house and possibly even obtain inspections, if they wish to. At the house auction, when the house is actually sold, to the highest bidder above the reserve price, it is sold in as-is condition.

The expectation is that several people will probably be attracted to the property due to its very low reserve price, leading to a very competitive bidding situation as soon as the house auction day comes. If this takes place, the owner of a house could attain the objective of getting the property sold speedily at a price near the fair market value.

The disadvantage to that approach is that in a sluggish market, it can be possible that no one will bid on the property or perhaps only a few people may possibly bid and you might only hit the minimum reserve price – in which particular case the home-owner may have been able to sell the house for cash more rapidly and without having to pay for the advertising or put up with the problems of the auction.

 

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Well, sort of. Like lottery tickets, it can work if you are lucky. It also works well for certain types of homes (like HIGHLY unique homes) in certain types of markets.