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When a home auction is appropriate

Auctioning a house is not for every homeowner. But in some cases, it could work to the seller's advantage.

According to the National Association of Realtors Auction Web site, a property might be a good auction candidate in situations where:

The market is:

  • Changing.
  • Dull (too much product, but buyer interest is expressed).
  • Emerging.
  • Lacking enough of the property type (unique, lake front, etc.).
  • A seller's market, where there is known high demand and room for a lot of competition.

The seller:

  • Needs immediate cash.
  • Has a partnership or marriage breakup.
  • Is moving out of 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.
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The property:

  • Has equity or 25 percent or more.
  • Is unique, but there is enough buyer interest to encourage competition.
  • Poses high carrying costs for the owner.
  • Is vacant.
  • Is difficult to appraise.

Jay MacDonald is a contributing editor based in Mississippi.

-- Posted: June 2, 2004
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See Also
Main: Putting a home on the auction block
20 tricks to selling your home
6 reasons your home isn't selling
Track prime rate/other leading rate indexes
More real estate stories

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