Home Buying in Washington>Question Details

Fungirl, Home Buyer in Washington, DC

HOUSES UP FOR AUCTION

Asked by Fungirl, Washington, DC Wed Jan 9, 2013

Why do house go up for auction instead of just saleing them.

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Answers

6
Hi Fungirl,

Houses go up for auction for several reasons, but here are the main ones:

1 - Bank foreclosure. The bank wants it off their books and doesn't want to go through the process, and time, of listing it on the market. So, they put it up for auction. These happen all the time on courthouse steps. They are interesting to watch, if you ever have an opportunity to go to one. However, if the house doesn't sell at auction, then the bank takes it back and eventually lists it for sale.

2 - Estate sale. The owner is deceased and the executor has been directed to dispose of the property as quickly as possible to cover costs of the remaining debts. This usually has a reserve price that must be met before the house sells. If it isn't met, then it will go on the market.

3 - Tax lien. The owner has not paid their taxes in many years and the city has taken possession of it and puts it up for auction to recoup the taxes owed on it. Usually in this case, it goes to the highest bidder, no matter the price.

Hope this helps!
:)
Kelly Putz
kelly,putz@gmail.com
703-961-8663
Realtor® in DC, MD and VA
Keller Williams McLean-Great Falls
0 votes Thank Flag Link Thu Jan 10, 2013
Usually because they do not sell on the open market and an auction is the last resource. Courts of law can determine if a property should go to auction, owners have the option, banks have the option. The purpose is to get the highest price from the highest bidder of course.
0 votes Thank Flag Link Wed Jan 9, 2013
because they don't sell on the open market usually...so the bank or whoever options to auction to the highest bidder.
0 votes Thank Flag Link Wed Jan 9, 2013
Hi Fungirl,
Lenders are not in the Real Estate Business so they are more willing to sell the property then hold on to it.
0 votes Thank Flag Link Wed Jan 9, 2013
It will be auctioned off if it is bank owned and has been foreclosed on. Usually that happens if the money owed on the property is so much more than the property could be sold for - then the bank takes possession and auctions it off. please let me know if I can help with any other questions.
thanks,
Kornelia
202-669-5555
0 votes Thank Flag Link Wed Jan 9, 2013
Most of the homes put up for auction are distressed homes. Most will not qualify for any financing means. Investor will pick them up and renovate them allowing the property to be fanciable again.
0 votes Thank Flag Link Wed Jan 9, 2013
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