What Properties Are Suited For A Real Property Auction In Arizona
Contrary to public opinion, a real property auction in Arizona offers selling conditions
that are sometimes better than traditional real estate sales methods. Real estate auctions, in the United States, are on the rise. Banks, lawyers, and property owners are discovering that a real property auction in Arizona is a sound option and an avenue to profitability. This article will discuss real estate auctions and provide information about what property is suited for auction.
Ever wonder how you can tell if a property is well suited to auction? Think of your listing, then take the Two-Thirds Rule test!
Q. What properties are suitable for real property auction in Arizona?
A. Most properties are salable by auction. All types of real estate, including residential property (e.g., town homes, condominiums, cooperative apartments and single-family homes), commercial and industrial property, vacant land and even boat slips are sold at auction. Not all property, however, is suited for auction. If a property will only appeal to a narrow market, auction may not be the most effective marketing method.
Self-Test:
One method to determine if auction is the best marketing strategy is the Two-Thirds Rule. This involves analysis of the market, property and seller situation. Generally, if two of the three parts (market, seller, property) lean towards auction, then auction should be offered to the seller as a sales option.
Self Test for Buyers -- A good auction situation is one where the market is:
* A changing market
* A dull market; too much product but buyer interest is expressed
* Not enough of the property type (unique, lake front, etc.)
* An emerging market -- new developments could kick off a sales program, once some of the properties were auctioned
* A seller's market where there is known high demand and a lot of competition can take place
Self Test for Sellers -- A good auction situation is one where the seller:
* Needs immediate cash
* Has a partnership or marriage break-up
* Is moving out of the state
* Wants to liquidate an estate
* Is retiring
* Is an auction-minded seller
* Has a listing that is about to expire
* Has already purchased another house
* Knows the auction will bring a fair market price
* Has financial problems
* Has high carrying costs on the property
Self Test for Property -- A good auction property is one that:
* Has a lot of equity (25 percent or more)
* Is unique -- there is enough buyer/market interest to encourage competition (unique properties are difficult to appraise)
* Has a lot of high carrying costs for the owner
* Is vacant -- vacant properties may encourage vandalism
* Is difficult to appraise
If you are considering selling your real estate it is important to consider all sales methods. Consider the Two-Thirds Rule discussed in this article and if two of the three parts lean towards auction, then a real property auction in Arizona may be a viable option.
by: Deb Weidenhamer
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