In real estate, there are several ways of acquiring and selling properties. In this article, we are going to look into real estate auctions and traditional sales – their features and differences – so you can decide on what is best for your property.
Selling Your Property: Real Estate Auction vs. Traditional Sale
Suppose you have land, a house, or a structure to sell. In that case, you might be wondering which sale strategy would work the best for you: placing it at an auction or the traditional real estate buy and sell. Below, we are going to talk about the fundamentals and differences of both methods.
Real Estate Auction
A real estate auction process starts with a property owner contacting an auction company. The company may look into the property first to determine whether or not it is fit for auction.
Recently, online property auctions have gained popularity. Similar to regular real estate auctions, properties in online auctions undergo marketing and a bidding process where the highest bid wins. Owners can set an opening bid and determine the duration of the auction, which generally takes place within 30-45 days.
Traditional Sale
In real estate, traditional sales involve hiring an agent to look for potential buyers or prospective real estate properties available for purchase. Traditional selling methods rely primarily on the real estate agent’s interpersonal skills and marketing skills to attract customers by highlighting the usefulness of the property.
A real estate agent shows the property to potential buyers and waits for them to make an offer. Depending on the circumstance, the whole process may take negotiations until both parties agree on the offer.
Real Estate Auction vs. Traditional Sale
Below we broke down the common differences between real estate auctions and traditional methods of selling real estate properties:
Real Estate Auction |
Traditional Sale |
| Timeline | |
| Generally, auction sales take less than 30 days to occur. | Property may remain on the market for months or even years. |
| Competitive. Multiple buyers bid on a property. | Sellers wait for the potential buyers to place an offer. |
| Auction brings out a sense of urgency to promote buyer interest. | Price reduction prompts buyer interest and action. |
| Pricing | |
| Limitless upside potential. An increase in bids results in a successful purchase. | The asking price is usually negotiated down. |
| After setting the opening bid, there is an opportunity to achieve an actual market price. | There is a risk of overpricing and underpricing. |
| Terms and Contingencies | |
| Earnest money is non-refundable. (Earnest money serves as a deposit made in real estate dealings to show serious interest in purchasing a property.) | Buyers can easily back out and ask for an earnest money refund. |
| Property sold ‘As Is’ with no contingencies. In real estate, contingencies are referred to an agreement that should be met to make the purchase legally binding. | Properties come with contingencies and numerous inspections that would require sellers to decrease their asking price, make concessions, or conduct property repairs and maintenance. |
| The seller sets the term prior to the auction. | The seller must negotiate many aspects of the sale. |
Real Estate Auction vs. Traditional Sale
Take Away
Real estate auctions and traditional property sale both have their upsides and downsides. Whether you are looking to buy or sell a property, it is necessary to consider your needs and choose the best sale strategy that would lead to a successful deal. Working with real estate experts specializing in auctions and traditional listings can significantly help in this process.
Looking to sell your property? Wiggins Auctioneers has conducted 5,800 successful auctions and offers traditional listings for your property. Our experienced and dedicated staff at Wiggins Auctioneers provides the service you need for a stress-free transaction. Contact or visit us in our offices located in Enid, Oklahoma City, and Fairview, OK.
