Hard-to-Sell Homes Go Up on Auction Block
Posted March 27, 2008
Chapel Hill, N.C. — Some people are turning to the auction block to sell their homes after the traditional "For Sale" signs haven't moved the properties.
The National Auctioneers Association saw a 5.3 percent increase in residential real estate auctions last year. Locally, real estate agent Christy Kimbro said there has also been an increase.
“I would say (that) in the last year, gosh, it’s been pretty drastic,” Kimbro said.
Chapel Hill homeowner Susan Roth never imagined she’d have a problem selling her Franklin Street home. Roth says she started feeling a toll financially and psychologically six months after she put the home on the market.
“You don’t necessarily realize the stress on a daily basis, but it really eats away at you over time,” Roth said.
So, Roth decided to put her home up for auction.
“All things considered, it was a worthwhile risk for us,” Roth said.
Roth is not alone. Four homes in another Chapel Hill neighborhood have also been put up for auction after being they did not sell the traditional way.
Even auctioneers themselves say that the process isn’t for everyone. Ben Farrell, of AuctionFirst, said it is something to which people need to give a lot of thought.
Auctioneers say they have had luck in selling some homes for prices more than the prices at which they were listed.
People who choose to sell by auction are at the mercy of the bidder to determine the price. Sellers can set a minimum below which they won't sell. Usually, that number is not disclosed.
Farrell said that if sellers want to hold out for a certain price, though, they should list with a realtor.
With auctions, the seller usually pays an advertising fee. The buyer pays a 10 percent cost on top of the bid.
Roth knows she may not make as much money as if she'd left her home on the conventional market.
“There’s always that concern. There’s always a certain amount of risk,” Roth said.
Though auctions are up nationally, they still make up less than 1 percent of all home sales, according to the National Association of Realtors.