There are Real Property auctions & bull crud property auctions. This is the latter of the two. A Real property auction is held at county courthouses or the like where homes ARE actually in foreclosure & are bid on with all cash.
This "auction", gets away with, what is in my opinion 'false advertising & misrepresentation", because our MLS system has "auction rules". It is also my opinion that the MLS system & our local & state boards of Realtors should NOT ALLOW this type of practice. If any agent or company advertises a home under "Auction Rules", they are able to get away with this.
I would love to hear from Auction.com & the Realtors who are affiliated with them. When they put a home like this on the market for "From" $200K, there are hundreds of buyers, like yourself that show interest, but can probably not afford or are unwilling to pay 50+% more & all those buyers are ticked off when they learn the truth, yet the affiliates of Auction.com have the opportunity to help those buyers find another property & they probably sit back & make more money off of incoming referral commissions.
I had a buyer recently who bid on a Bull Crud auction & we Were the highest bid. But that price did not meet the seller's reserve price. This is because Auctions attract buyers looking for "a deal", for which, with the Seller's Reserve price & the fact that the Seller is NOT in any kind of Financial Distress or otherwise NOT facing foreclosure, the seller later listed his home, Normally (not auction marketing) & ended up selling the house, in my recent case for near $50K over our Highest Winning bid.
There were some agents in my neighborhood from a very popular firm who tried this Auction type marketing a few years ago. Do you know why they stopped doing it about as quickly as they started???? Because they were seriously Ticking people off & it was giving them a Bad Name in the community.
A side note; Underpricing a home to get attention on a property & get multiple offers is Ok, but only within reason. I feel that underpricing a home like Auction.com does at 50+% less than what current market values are for non-distressed properties is bad. But pricing a home up to 20% below market, that's a bit more 'within reason'.
I had a client call me last week, bubbling with Joy & super excited to have found a Townhome in Huntington Beach saying, OMG this place is only $300K w/ 1500sqft, gated community, fully upgraded, I want to go offer on it right now, this is So affordable for me, it's unbelievable. She was correct in the sense that is Was Not Believable. And, turns out, it's another Auction.com offering.
So, I had to be the one to destroy her day & let her know about 'the hook' with Auction.com & that this property is Not distressed, the investors paid $555K for it, it wasn't selling at $639K, but they're never going to sell it, most likely, until they get between $600-625K. Sounds to me like these investors paid too much in the 1st place. But that's the risk, when buying homes on the courthouse steps at the REAL auction.
Shoot me an email directly or give me a call if you'd like to talk about this further or if you need expert representation to locate another property. I don't look back on this same Trulia posting for Answers or Replies posted after mine.
Emily S. Knell
Realtor Since--- 1996
Realty ONE Group