Auctions have been and continue to be a great way to sell property for maximum profits in a short amount of time.
What "Auction" Means
The word auction comes from the Greek word “Actus” which means to increase. Hence, the bid may start out low, but value will increase as the auction progresses.
Auctions in American History
Auctions have been a part of the American way of life for hundreds of years, going all the way back to our forefather’s arrival in this country. From the Pilgrims, Colonials, to today auctions have been used as a way of trading goods from tobacco, livestock, tools, and real property.
After the Civil War, Colonels were given the task of selling surplus goods and spoils of war through auction. Still today, anyone who has been to auction school and been trained in the auction craft is called “Colonels.”
Following the great depression many people liquidated their property, mainly farms, to pay their debts. Again, in the 70’s and 80’s during a farm crisis auctioneers were called upon to liquidate farms to pay debts.
In the early 2000’s after the housing boom auctioneers were called upon to be vendors for government institutions, banks, and other financial institutions to liquidate foreclosed properties. Which consisted of both houses, recreational land, and farmland. During this time auctioneers began to wear different hats and learned to be both auctioneers and traditional realtors, realizing to sale the property for the client they must be willing to accept an offer before the auction if possible, auction the property, and if the property did not sale at auction, market the property as a traditional real estate broker.
A Bad Name?
A stigma about auctions developed during the depression, 70’s and 80’s because of so many auctions being conducted on foreclosed properties. The stigma lingered for years, but that begin to change when potential buyers started walking away from an auction saying; “I cannot believe that property brought so much!” Hence, the boom in the auction industry, during the 90’s and the early 2000’s before the housing crisis, where individual sellers have realized a potential for maximizing dollars in the shortest length of time for their property and time value of money.
Sellers who have not been foreclosed, who want to offer their property on a set day, see an increase in value, have a none contingent contract with qualified buyers, close at an appointed time and usually have money in their hand 90 days after an exclusive right to sale contract has been signed. The auction is a perfect fit for these types of sellers.