Hi all!

I hope everyone had a great weekend!

I went to a real estate auction this weekend that I found quite interesting. I thought I would share some of what I learned with you. First off, this auction I attended is not like an auction on the courthouse steps that is going in to foreclosure. In Okaloosa County, Florida, you have to have the full amount of your winning bid by the end of the day in the courthouse type auction.

The auction I attended included properties from Panama City to Gulf Breeze, Florida. Some were lots, some were single family homes, and some were even very nice waterfront--both lots and homes. ALL of the properties were short sales, though. I thought that was interesting, because this did turn out to be a different option for both buyers and sellers.

If you've never heard the term "selling absolute" this is an auction term that means that the property WILL be sold to the highest bidder at that bid price. This auction company does not do absolute auctions, but also did point out that you cannot sell absolute on a short sale since the bank does have to approve the price in order for the sale to happen.

So how does the process work in this instance? For a seller who already has their home listed, and wants to try this route, they can work through their agent with the auction company. If it is not a short sale, the seller does have the option of not selling if the bids aren't high enough. The auction house does advertise prior to their auctions which they try putting on once every 4-6 weeks. At this auction a number of the properties already had offers that had gone to the bank for approval, but the bank approved them to still go to auction. After all, someone may come in with a higher bid than what's already on the table. It's likely the advertising that they were going to auction sparked the interest for those that did put in offers.

Those at the auction have no way of knowing what the current offers are that the bank is considering, so that can be a disadvantage.

So how is this a good option for buyers? You do have to pay a 10% buyers premium, which means that you pay 10% above the final bid price. BUT, you can still obtain your financing within 30 or so days. If you're already pre-approved, and you've viewed the property or properties you are interested in, this may be a very good option for you. The specific properties I was there to get a status on did not have a specific open house date(s). A buyer could view them with their agent through the lockbox system agents use.

Since all of the properties at this auction were short sales, that does mean that a property with the "winning bid" still had to submit it as an offer to the bank, for the bank to approve. There were only about 20 people at the auction, and I watched a few leave as soon as the property they were interested in was auctioned off. A few had the winning bids on their properties--and submitted those. Some didn't have any bids at all--which made me think this would have been such a wonderful opportunity for a buyer.

There are other auction companies out there, and I've learned they all do things differently, so make sure you do ask the questions important to you with any that you do work with as a buyer or seller. As the other auction companies sell properties, I plan to attend and share more of what I have learned with you!

Until next time!