Auctions? Are they good or bad?

By
Real Estate Agent with M and T property management LLC

I have always thought of auctions as a great way to buy Homes, cars, and many other things. I want to ask people what they think about them? It seems to me that the people holding the auctions make money, The agents in the industry make money. The lenders make money. I just wonder if people that go to the auctions realise that they are a part of all them making money. They are footing the bills?  Now I know some will say, "I do that now with out the auctions." I want to ask "do you?"

Could be be possible to get the same deal with a buyer agent from the MLS? I think people with hopes of getting great deals from auctions are looking for that big fish story that someone told them about. Are they wasting time by going to competing auctions where so many people have no clue what to do at these places and bid on things sometimes they don't even see. Where is the deal?

Matt the MARINE says sound off and let me know what you think.

Here is a link to show Detroit and a recent auction. http://abcnews.go.com/Video/playerIndex?id=2962515.

 

Matthew Meli

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Rainmaker
180,618
Robert McArtor
RE/MAX Components - Fallston Maryland - Bel Air, MD
Top Listing Agent for Baltimore and Harford County
Rich, you know what the sad thing is. This is the most information some agents will ever receive on the Auction Method. Sad
Mar 22, 2007 08:44 PM #12
Anonymous
Anonymous

Robert - I hope not.  I know that there are dozens of auctioneers teaching Realtors about the auction method in formal sessions every week.  I am teaching one next week in Columbus.  I have also been working on putting together a deal here with Chris Rasmus from Alexandria, VA out by you.  I've known Chris for years.  if you ever get the chance to do a deal with him, do it.

Peace to the Realtors

Mar 22, 2007 09:24 PM #13
Rainer
2,509
Jason LaBell
Premiere Realty Group, LLC - Detroit, MI

Robert-Rich-Billy,

Participating in this past weekends auction was a great experience for our team. We definetly look forward to participating in more of them. Not only is it a good way to get rid of properties it is also a great way to meet potential future clients. Again realtors that have not experienced it especially in this SE Michigan market are really missing out.

-Jason

Mar 22, 2007 09:30 PM #14
Rainer
40,137
Endea Thibodeaux
Auction2Sell, LLC - 240-381-6653 - Lanham, MD
CDPE, CLHMS, RECS, Real Estate Auctions - DC, MD, & PA
Auctions are good but not all Sellers or properties are good for Auctions.  In this market one must consider all the alternatives.
Mar 22, 2007 10:10 PM #15
Rainer
27,550
Tom Giansante
The Title Company of Jersey - Wildwood, NJ

Matt,

There are at least a couple different types of auctions.  The one's that you really need to pay attention to are the "absolute" auctions.  The properties actually sell at those.  Somebody is going home with a deed at one of those auctions.

 

"Grapefruit"

Mar 22, 2007 10:58 PM #16
Rainmaker
180,618
Robert McArtor
RE/MAX Components - Fallston Maryland - Bel Air, MD
Top Listing Agent for Baltimore and Harford County

Endea - Preaching to the Choir.

Rich - COOL! - I will have to remember that.

Mar 22, 2007 11:04 PM #17
Rainer
64,690
Kelli Fronabarger
Bend River Realty Inc. - Bend, OR
Realtor - Bend Oregon
Something more than blogging going on here- I personally would love to know more about real estate auctions and have enlisted the help of Rich Kruse in educating me. Thanks for the post : )
Mar 22, 2007 11:56 PM #18
Rainer
12,420
Christopher Sevick
Sevick Law PLLC - Ypsilanti, MI
Real Estate Attorney

I have a potential client now who purchased at auction and now does not want the home.  She and her husband are in the group who purchased an "investment" because in part it was cute and close to their primary residence.  First time investor thinking they could do work & rent it. 

After inspections they are very discouraged and know they have more than they can handle.  They are discussing actually using an auction to move it since they feel it will have better opportunity than the MLS.  They are the rare group, from what I have seen, that purchase without knowing.  Auctions are a way to move inventory, find those investments without everyone walking around in boots, hats and with flashlights into 30+ homes over weeks of time and put homes into the hands of people.  Use the "open house" before the auction to inspect and then decide. 

Mar 24, 2007 05:53 AM #19
Rainer
27,578
Billy Burke
The Auctionarium, Inc - Rancho Mirage, CA
CAI - AARE

Christopher:

This is exactly why we encourage all prospective bidders to inspect before bidding.

This is why we require our sellers to provide disclosures on all properties as part of the Bidder Information Package (BIP)

Buyers remorse is exactly the reason auctioneers require non-refundable deposits before allowing a bidder to bid on a property.

When one is purchasing real estate in the State of Michigan as an "investment" they are assuming a certain amount of risk regardless of it being a derelict home in Detroit or a mansion in Gross Pointe.

Please note that auctioneers do not hold "Open House" on properties.

We host property previews and inspections meaning that everyone who walks through the doors has to register and sign in on a form stating they will indemnify the parties and abide by the rules.

Great comment from a local real estate Attorney.

I think everyone watching this thread is waiting for MATTHEW MELI to respond to the rebuttals of his slamming the auction profession which has 2000 years of traditions and regulations, a trade conducted in the open and sunlight...

Compared to his group of organized criminals (NAR) that has created an illegal monopoly to control and limit the open exchange real estate, relying upon secret closed door negotiations, held by people who pay extortion to use the almighty MLS and a forbidden by law of telling a buyer what any bids or "offers" received are so they can make an informed buying decision.

Mar 24, 2007 10:31 AM #20
Rainer
7,506
Matthew Meli
M and T property management LLC - Detroit, MI

Well here we go again. over the week, I have read what people are saying about this topic. I will say I like that people are at least "talking" about this. To move past the bull !@#$, I see that some of you are with the auctions. Please do your self a favor and look back to what you have wrote.

Now that you have, please tell me that with some of your comments are any different then mine made to Jason LaBell. I was talking to him at first. I said what I needed to him.

Billy Burke, CAI - AARE wrote-

 

I think everyone watching this thread is waiting for MATTHEW MELI to respond to the rebuttals of his slamming the auction profession which has 2000 years of traditions and regulations, a trade conducted in the open and sunlight...

Compared to his group of organized criminals (NAR) that has created an illegal monopoly to control and limit the open exchange real estate, relying upon secret closed door negotiations, held by people who pay extortion to use the almighty MLS and a forbidden by law of telling a buyer what any bids or "offers" received are so they can make an informed buying decision.

Now is that nice? Is this even on topic? Looks like some one watched to much TV as a kid! To start, The only slamming I did was to who I was talking to.

Next, "Group on criminals" The NAR? I would love to hear what they had to say about that. 

Moving to the next one- Billy Burke, CAI - AARE wrote

Do you want to know the difference between an auctioneer and a Realtor?

An auctioneer works!

Now that's some good time laughs! I think at some point you have to look at how silly people can be! He then tells me about what he does and and some time lines, then put a funny picture up to show just how funny he is. This guy is like a clown, he makes everyone laugh.This guy then writes about MY LOVE, DETROIT!  He writes-

I just figured out why this man is actually hateful towards auctioneers.

He lives in Detroit where it sucks to be a Realtor right now.

I will ask! Maybe he knows about Detroit? Billy Bob, have you sold here in Detroit? have you been to Detroit? Do you know what you are saying about Detroit, or do just know how to read? befor you open your big giant trap you call a mouth come to Detroit and let me show you Detroit!! Till then sir, lock it up! NEXT!!

 

Then this guy, Robert B. McArtor, REALTOR®, Auctioneer He writes, Auctioneers are not agents, hanging a license with a Broker.  Look at the above, Does that say REALTOR?

 Along with, I have been an Auctioneer now for 16 years. I have never witnessed anyone "overpay" for a property.  maybe he should talk to Christopher Sevick, Real Estate Attorney sounds like some one did! just read this

I have a potential client now who purchased at auction and now does not want the home.  She and her husband are in the group who purchased an "investment" because in part it was cute and close to their primary residence.  First time investor thinking they could do work & rent it. 

After inspections they are very discouraged and know they have more than they can handle. 

Now, let's all look back and read! Looks like "some of you" are bulling people! If you are, Remember this is not an auction! It's not you holding all the cards. This is open to all and we are talking!

In closing, As far as,

Guys - I don't think Matt really wanted us all to sound off like THIS by Rich Kruse 

I don't think you know well enough! so let me say it again!

Matt The MARINE says sound off, and let me know what you think.

 

 

Mar 26, 2007 12:03 PM #21
Rainmaker
180,618
Robert McArtor
RE/MAX Components - Fallston Maryland - Bel Air, MD
Top Listing Agent for Baltimore and Harford County

Matt, the way you respond to comments, you sound as if you are 15 years old. Look at my Profile. I have been an Auctioneer for YEARS longer than have had my Real Estate License. http://www.MDAuctionSales.com/ I don't even know what your complaint is about my statement?, "Auctioneers are not agents, hanging a license with a Broker" I just happen to be an Auctioneer WITH a Real Estate License.....kinda like you are a Front Line "I have a death wish" Marine AND an Investor.

Now, to my next statement you are trying and failed to make a point with, "I have been an Auctioneer now for 16 years. I have never witnessed anyone "overpay" for a property" - Sorry Matty, the good Attorney never mentioned they overpaid. They simply got over their head with the amount of updates and repairs the property needed and had Buyers Remorse. Nope.........nothing about overpaying.....

I am glad you started another group called, "Detroit". You can "Sound off" in your own juvenile world.

Mar 27, 2007 12:13 AM #22
Rainer
2,705
Scott Sohle
RE/MAX Western Realty - Durango, CO
RE/MAX Western Realty
Auctions are just another way to market a property, a good one in my opinion. The seller will seldom get top dollar, but they will have a sale in a predictable time frame. That's a good deal for many sellers. Lots of neophytes think great deals are being given away at auctions, seldom is the case. If a good deal is had, it is with additional risk as inspections are seldom thorough, or even possible. And no-one is going to give a hoot about your punch list of fix-it items.
Mar 27, 2007 12:38 AM #23
Rainer
7,506
Matthew Meli
M and T property management LLC - Detroit, MI

 Robert B. McArtor, REALTOR®, Auctioneer

You wrote "Auctioneers are not agents, hanging a license with a Broker" I just happen to be an Auctioneer WITH a Real Estate License.

When you write that it make you seem like you think you are above an a agent. I would say we work as hard as you say you do for the last 16 years. We are one of the same as a Realtors are we not? Yet you bag an agent? I don't hang a license as you speak of.. I make my broker money. Don't you?

With your next line you continue to state that you never witnessed anyone overpay? I bet the jury is still out on that.  I think a lot of people have, and auctions are not the best for the open public. Do you think that would have happened if they had a buyers agent? Would they be "over their heads" or 'over pay" as I stated? I guess as a Realtor, you don't have to worry about that?

I have tried to keep on open line with people on this topic. It seams like people just have to keep it going. Such as you calling me a 15 year old. Was that fun?  Do you feel better?

As far as me starting a group called Detroit... I am happy that you take the time to follow what I am doing. I have yet to call you names or trash you in any way but you suggest me as A "JUVENILE, 15YEAR OLD, I HAVE A DEATH WISH, AND STATED THAT I HAVE NO POINT."  Yet you take the time to address me? Well may God help you sir, and good luck. I think it would be clear to anyone who is the "juvenile." Maybe in another 16 years you can be old enough to know better.

Matt the MARINE says sound off, if ya got a pair!!

Mar 27, 2007 12:46 AM #24
Rainer
27,578
Billy Burke
The Auctionarium, Inc - Rancho Mirage, CA
CAI - AARE

Dear Matt:

I am glad that you are back in the game because a Marine never backs down.

There are a lot of misconceptions about auctions and auctioneers that have been brought up here because of this post.

People do not buy at auctions, they Win auctions.

People who win property at auctions are pleased with the price because they only paid one bid more than someone else was willing to pay.

ALL NEGOTIATION IS IN THE OPEN & SUNLIGHT

Agents are phrohibited by law from telling a prospective buyer what the last "offer" and counter made were.

It is against the law for you (agent) to tell a prospective buyer that the person who just dropped out had a home inspection done and did not like the results.

We can go on and on and around in circles but I would rather take you up on your invitation to visit Detroit soon.. heck I will buy the first couple rounds for you.

Sincerly,

Billy Burke

Mar 27, 2007 08:21 AM #25
Rainer
4,170
Tish Shaftner Mosteller
Lincolnton, NC
You know, I've read a LOT of blogs and comments here on AR, I thought our mission here was to help one another out?  To share our knowlege and ideas?  It's a shame that personal opinions have gotten in the way of sharing good information here, auctions are a very interesting subject!  I am familiar with and have worked auctions and am also a licensed Broker.  There are good and bad with both, just like with everything else in life! 
Mar 27, 2007 10:53 AM #26
Rainer
7,506
Matthew Meli
M and T property management LLC - Detroit, MI

To my new friend Billy Burke, CAI - AARE , It looks like we both feel strong about what we do. I would welcome you to meet me here in Detroit. We could both benefit from that happening. You could even come back from your trip and say something nice about Detroit.

I can understand how you feel about the auction being open for all. I will let you know that in Detroit as you stated,we are in a down market. We have a lot of listing to choose from at many different prices. Sometimes it is hard to even get an offer. I would have to say it is a rare thing to happen to have multi "good" offers at the same time. As far  as you saying what an agent can and can't do, are wrong. I read what you stated and it is clear we don't work the same way. It depends on who you are working for. If I know that there is something wrong I have to disclose it, aways!Thats is the law. As a buyers agent, It is my job to work for them only. I would do the same for a seller as well. I aways welcomed agents to buy my listings. I see it as two different topics, buyers / sellers agent. In the past I have pasted on being both, even in our down market. I aways try to do what is right. not saying doing both is wrong, It's just hard to be both, it is a fine line, and could get a person in a ton of trouble. This seams to going to a different topic.

I know that laws change from state to state and we are not all on the same page, but that's why I like sites like this, they help us all learn. You are right about going round and round, So please come to Detroit.

Thanks for sounding off!! See ya soon

-Matt the MARINE

Mar 27, 2007 11:58 AM #27
Rainmaker
180,618
Robert McArtor
RE/MAX Components - Fallston Maryland - Bel Air, MD
Top Listing Agent for Baltimore and Harford County

Matthew....gotta love you man.

As Billy said, a Marine doesn't back down. being a military brat myself, I have a great appreciation for that. It is however, frustrating to read your initial Blog, as if you were a novice to the "Auction Method of Marketing"? and if you are....then listen to some of the experts in the field. Whether you agree or not, Thousands of Properties are SOLD using the Auction Method.

You are receiving great advice here but you keep going on the defensive with little statements here and there. A good Marine knows when to zip it and listen to a Colonel in the Army of Auctions...(Billy Burke owes me a drink for that one).

Auctioneers for years have understood the role of Real Estate Agents, accepted the traditional sales method and even encouraged Buyer Agent participation. I have worked with MANY agents in mutually beneficial deals with one goal in mind....Meet the Sellers REALISTIC expectations then GET PAID! 

Fact - Auctions of residential and other types of properties have been growing steadily around the U.S. Some $14.2 billion in residential real estate was soldthrough auctions in 2005, up 8.4 percent over the previous year, according to the National Auctioneers Association (NAA).

If you are an Investor and not actively seeking out Auctions as a source of building your inventory, you are missing out!  The properties bring FAIR MARKET VALUE......Period! Fair Market Value based on condition, location of course.

From a Military Brat of a Chief Master Sergeant of the Air Force to a Marine! Have a Great and Prosperous Day......when you or your client get into a situation with a property and you need to sell.....an Auctioneer will get the job done for you! Don't discount their methods, they have been around since the beginning of ROME and will always be around.

 

 

Mar 27, 2007 01:24 PM #28
Rainer
7,506
Matthew Meli
M and T property management LLC - Detroit, MI

Thanks for the advice and and phone call. I will say it takes a big man to do and say what you have. I will agree to disagree with you. As far as the comments made on this blog, I see the value of it. If the world was all the same we would be bored out of our minds. I respect a person that takes the time to make a call and say they are sorry. I truly mean that. Thank you.

Robert, I will always stand for what I think is right.  You know what they say.. "If you don't stand for something, you will fall for anything."

Semper FI Do Or DIE

Matt the MARINE says, thanks for sounding off!!

Mar 27, 2007 02:03 PM #29
Rainer
7,506
Matthew Meli
M and T property management LLC - Detroit, MI

I sure hope that after all this people will see that Detroit is not all that bad. Join my group @ Detroit on this group seach.

Thanks again all

Matt

Mar 27, 2007 05:21 PM #30
Rainer
7,506
Matthew Meli
M and T property management LLC - Detroit, MI
Sorry I had to delete that one guys.
Mar 31, 2007 04:12 PM #31
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