Real estate auctions are often misunderstood, leading many
buyers and sellers to overlook their benefits. Let's break down five common
myths about real estate auctions and uncover the truth.
1. Auctions Are Only for Foreclosed or Distressed Properties
While many foreclosed properties do sell at auction, not all auctioned homes
are distressed. Sellers use auctions to create urgency and competition, which
can drive up the final sale price. Many high-value and unique properties are
sold at auctions for this reason.
2. Buyers Can’t Inspect the Property Before Bidding
A common misconception is that auction properties must be purchased sight
unseen. In reality, most auction houses and sellers provide opportunities for
inspections before the auction date. Buyers are encouraged to do their due
diligence to ensure they are making an informed decision.
3. Auctions Are Only for Investors and Cash Buyers
While cash buyers and investors often participate in auctions, they are not the
only ones who can bid. Many auction properties allow financing, just like
traditional home sales. Some auctions even accommodate traditional mortgage
buyers, provided they meet the necessary requirements.
4. Auctions Mean Bargain Prices Only
It's true that some properties sell for less than market value at auction, but
competitive bidding can also drive prices higher. Desirable properties in
sought-after locations may even sell for more than their appraised value due to
strong buyer interest.
5. Sellers Have No Control Over the Sale Price
Sellers often assume that they risk losing money at an auction, but they have
options. Many auctions allow sellers to set a reserve price—the minimum amount
they’re willing to accept. If the bidding doesn’t reach that amount, the
property doesn’t sell, ensuring sellers retain control.
Real estate auctions can be a strategic way to buy or sell a property efficiently. By understanding the facts, buyers and sellers can take advantage of this dynamic and transparent sales method with confidence.
Heritage Brokers & Auctioneers® are your one-stop shop for all things real estate and auctions in the Kansas City area. They specialize in lifestyle real estate, from charming homes and sprawling land to commercial properties and businesses. Their auction expertise shines with a variety of services, including farm and land auctions, estate sales, and even benefit auctions. With their extensive network and marketing prowess, they'll ensure your property gets the exposure it deserves. Call 877-318-0438 for more information on one of our amazing properties and/or land locations.