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December 2007
I would like to take a moment to wish you all a Happy, Safe and Prosperous New Year. Together, lets' make 2008 the best year ever.
2008 will be an amazing year at Kleinknecht Real Estate Consulting with our focus being on getting MORE OF YOUR EQUITY IN YOUR POCKET when selling... Impossible you say??? Very Possible I say !!
We'll be announcing a new sales concept in the coming weeks. We hope you will be able to utilize these new services, but know one thing; we are here to help, no matter what!
I'd like to be the invaluable real estate resource you can utilize whenever you need one.
1:33 PM - Dec. 31, 2007 - {0} -
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What are the different types of real estate auctions available in the local marketplace? Well, essentially there are three types of auctions:
ABSOLUTE AUCTION (or auction without reserve)
The property is sold to the highest bidder, regardless of the price. Since a sale is guaranteed, buyer excitement and participation are heightened. This type of auction typically generates maximum response from the market place. Many sellers, including financial institutions and government agencies have begun to use this method more and more frequently.
MINIMUM BID AUCTION
The auctioneer will accept bids at or above a published minimum price. This minimum price is always stated in the brochure and advertisements and is announced at the auction. There is reduced risk for seller as the sales price must be above a minimum acceptable level. The buyers know they will be able to buy at or above the minimum. The seller may, however, limit interest in the auction to only those buyers willing to pay the minimum bid price, so therefore it must be low enough to act as an inducement rather than a hindrance.
RESERVE AUCTION ( an auction subject to confirmation)
In this scenario, the high bid is reduced, in effect to an offer not a sale. A minimum bid is not published, and the seller reserves the right to accept or reject the highest bid within a specified time -- anywhere from immediately following the auction up to 72 hours after the auction concludes. Sellers predetermine the price at which the property will be sold and are not obligated to confirm a sale other than at a price that is entirely acceptable to them. The main disadvantage of a Reserve Auction is that prospective buyers may not invest the time and expense of due diligence when there is no certainty they will be able to buy the property even if they are the highest bidder.
What Factors Impact the Success of an Auction?
A. The seller must have realistic expectations, including a fair sales price, terms and timing.
B. The desirability of the property. This includes location, conditions, plus the value of surrounding properties.
C. Since a variety of auction methods are available, carefully choose the auction type that best suits the property and the seller's needs.
D. A well planned, aggressive marketing/advertising campaign targeted to prospective purchasers is critical to an auction's success.
E. Using a recognized real estate auction company or a REALTOR® auctioneer to ensure the auction is conducted in a professional manner and followed-up through closing.
F. Making sure that due diligence information is provided to prospective buyers AHEAD OF TIME.
G. Preparing the property for sale so it is presented to prospects in its best condition. (i.e.., title insurance, clean-up, financing, etc...)
The Two-Thirds Rule
Not all properties should be sold at auction, but certain properties and situations will benefit greatly. A dependable way to determine whether a property lends itself to auction is this: If two of the three main components of a transaction (market, the seller and the property) lean favorably toward auction, then it should be considered as a sales option.
CLICK HERE for a checklist by e-mail autoresponder to help figure out if the Two-Thirds Rule applies to the property you have in mind.
8:58 AM - Dec. 26, 2007 - {0} -
View more entries tagged with: Real Estate Auction
When you visit the first home on the list of prospective properties, make mental and written notes in two areas. The first is whether or not the home matches your list of features, size, style, price, etc. The second is whether the home “feels” like your kind of home. Is it comfortable? Does the traffic pattern “flow”? When you visit the second home, follow the same routine.
Now, here’s where you can simplify the choice. Before continuing to the third house, compare the first two only. Play a mental game with yourself by saying “If I had to make a choice today, and the only two choices were the homes I’ve just seen, which one would I choose?” Don’t continue to the third home until you’ve made that choice.
Repeat this process after seeing each home, comparing the one you’ve just seen with your previous choice. This eliminates unnecessary procrastination and confusion. At the end of the day, the right choice should be clear.
9:00 AM - Dec. 21, 2007 - {0} -
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Ever heard the expression that "a camel is a horse created by a committee"? If so, and you have ever served on a committee, you can understand the humor in that statement. It seems that the more people are put in charge of making a decision, the greater the chances that no decision will be made.
Buying a home requires a decision of major proportions. It should not be taken lightly, nor should it be allowed to become a "committee" decision. If you plan to purchase a home, try limiting the number of individuals who will be involved in the final decision.
If only you and your spouse will live in the home, and none of the downpayment or other costs will be borne by others, avoid involving other relatives in your search for the right home.
Small children might also be included in the group of non-decision-makers. A home search may involve a half-day or more of short visits to a number of homes. This can wear on the patience of children as well as parents.
Ask questions, expect answers, and become knowledgeable about the homes you see. Then, make an informed decision. Only when you have signed a contract to purchase the home of your choice - once the decision has been made and acted upon - then you can tell the world!
2:24 PM - Dec. 17, 2007 - {0} -
View more entries tagged with: Real Estate Commentary
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