Auction Seller Information
I. Competitive Marketplace
The auction method of marketing creates a form of competition that cannot be duplicated by private treaty. Each bid reinforces the market value of the property. This affirmation of value encourages other participants to continue bidding. Within all of us is a tremendous need to win. In a traditional real estate sale the buyer satisfies this need by negotiating the seller down. In an auction the buyer can only win if he outbids all other bidders.
The auction brings all interested parties into one place at the same time for a single purpose – to determine who will pay the most for the property. All interested parties are ‘forced” to make a decision. Getting an interested person to act is the most difficult thing for a private treaty broker to do.
The terms of the auction are established by the seller. All buyers are bidding based on a common set of terms and conditions. The seller stays in the driver’s seat throughout the process.
III. Immediate Results
When the sale is over we will provide to you a signed purchase contract with a deposit check. After the contract is completed, the sale will be closed in about 30 days. The principle of time value of money suggests that a dollar received today is worth more than the same dollar to be received at a later date. The traditional method of private treaty sales has little ability to capitalize on this principle. While real estate may never be as liquid as stocks or securities, the auction method increases your liquidity significantly.
The auction will reduce your cost on two fronts. First, the holding cost of the property is eliminated. The auction will terminate expenditures such as: interest, taxes and maintenance. Second, there is the cost of lost opportunities. Consider what investments might be lost while your equity is tied up in unproductive properties.
Let your equity work for you!
This is one of the strongest advantages of our auction method – the promotion of your property. With any product that is sold in the free enterprise system regardless of the value of that product, there is a certain amount of the price of that product which must be attributed to advertising costs.
The Caterpillar company makes large earth moving equipment, which costs hundreds of thousands of dollars. To sell their products – they must advertise.
The Coca-Cola company sells bottled coke, a very inexpensive product. Any person in America can afford a coke. But, the Coca-Cola company spends millions of dollars advertising their soft drink.
It is inconceivable to believe that anyone would attempt to sell a product such as a house or other real estate without properly advertising it. However, real estate agents find it difficult to do a proper job of advertising simply because the funds are not available. No one knows when or if the property will sell; therefore, it is difficult to risk a large expenditure on advertising. With an auction, we can effectively determine when the property will sell; therefore, the owner can afford to attribute a certain amount of that sales price to advertising. By using signs, print media, electronic media, the Internet and direct mail campaign we can perform a media blitz that will reach all the prospective buyers.
We can put more people across your front door in two weeks time that you would otherwise see in two years!
Excitement and motivation are used to the fullest with a public auction. Professionally trained ring men apply continuous motivational pressure to the buyers to gain every dollar possible. This sense of excitement works to create the psychology of impending sale, which is so critical to the success of your auction.
It is the interaction of these five areas, which make Barr Auctions today’s most successful method of marketing.