The relinquishment of a property comes in many forms, and no one situation is right for the majority, let alone everyone. An auction is just one option among many, and it has its own set of particular features. Auctions have the potential to get a sale done- but at what cost? Is that cost viable and logical for someone in a certain type of situation?
Auctions are not designed for a certain “type” of property. An auction is designed around the motive and the reason. The seller sets the terms. From there, the buyers bid on how appealing and attractive those terms are. The middlemen (for the most part) are removed entirely. The property goes for sale. The auction sets off. The sale is final.
What is the main thing someone selling through a commercial land auction is receiving? Obviously, they are getting paid for the property. The more important question is the why? What kind of situation is conducive for an auction as a seller?
The most immediate concern is time. The sale with commercial auctioneers is both certain and in a timely fashion. The property will 100% be sold by the date of the auction. In rare instances, the auction can be postponed. The auctioneers will sift through the property, which includes clearing it of liens and other title concerns. So by the time it is approved for auction and finalized, the sale will occur.
The Fast Sale
The timeframe is relevant because it can confirm a sale is happening with the commercial auctioneers. What situation brings someone to seek a fast sale? A seller may have high carrying costs. This could be associated with taxes, HOA fees, utilities, and other concerns. The seller may also want to control how the sale plays out. The commercial property auction process allows them to keep close control of how the property is presented and sold- a feature largely missed when working in the slow process of a realtor sale.
The certainty of the sale comes from the forum of the auction and the upfront fees. Buyers are required to pay a deposit. There is also a strict deadline for payment. Typically, buyers who attend an auction need to offer a “proof of funds” document to ensure they have the finances available to purchase on a property. Ultimately, it comes down to certainty. Sellers are willing to forgo a higher price on their property to guarantee that the sale will occur. They can look forward prosperously.