interviewed real estate professional and been placed or not. And we have ring depending on the state. If you get
author Barbara Corcoran about real men in the audience whose job is to caught up in the frenzy and don’t
estate auctions. Among other tips, identify who is bidding and relay that account for the additional fees, you
Corcoran suggested that you dress information to the auctioneer.” may wind up getting exactly what
“like a millionaire” and sit or stand And finally, remember the buyer’s you want for a price you hadn’t
close to the auctioneer. By doing so, premium, otherwise known as the intended to spend.
you may fool your fellow bidders into auctioneer’s commission. Typically, it’s Sure, you can knock TV sitcoms
thinking you’re a banker with unlim- 7 percent to 10 percent of the price of if you want. But art has been known
ited funds, and they might not bid the house, and it’s added on to your to imitate real life.
against you. fee, along with a transfer tax and other Geoff Williams can be reached at
You can give this approach a try, of fees that are allowed by law and differ
gwilliams1@cinci.rr.com
course, but Tarver and Bellejos both say
that ploy isn’t likely to work. In fact, if
you want to be sneaky, Tarver says, “You
Auctions, Auctions Everywhere
may want to come to the auction under
the radar — dress down, if you will, sit in
the back row, and slouch. And instead
of being the one who is up front and
center, be the one who barely raises
the paddle. As a result, you may be able
to sneak in a good deal.”
O
ne in every 538 households nationwide received a
foreclosure filing during March, according to RealtyTrac,
which reported that foreclosures jumped 57 percent
Klein echoes that sentiment, noting
during the month compared with March 2007.
that most of the millionaires in atten-
dance these days seem to be dressed
And most experts agree it’s going to get worse. Another report finds that one
in jeans and T-shirts.
in 33 homeowners can expect to be in foreclosure within the next two years.
But this isn’t a game, cautions Tarver.
With bank repossessions growing, it’s easy to see how the number of real estate
“It’s not smoke and mirrors, and
auctions would increase as well.
winning a bid isn’t a matter of being
And it’s not just foreclosed houses that are being auctioned. With the housing
tricky, but [of being] educated. You
market sluggish, sellers are increasingly attracted to auctions because a piece of
should meet with a REALTOR®, an
property can usually be sold in a matter of weeks versus the traditional way of
attorney, and a lender beforehand —
selling, which may take months… or years.
you can even bring one with you. But
Buyers, meanwhile, naturally relish the idea of getting a house for a better
use some restraint. I recommend going
deal than they’re likely to find going through the typical channels. In fact, auctions
in, saying to yourself, ‘I’m qualified for
were growing in popularity even before the housing market tanked. And for the
$200,000, and that’s it.’ And don’t get
last five years, real estate auctions have increased in number each year, according
caught up in the frenzy. Auctions are
to the National Auctioneers Association (NAA).
fun, absolutely fun, and they’re exciting.
In 2007, the live auction industry sold $270.7 billion in items, 23 percent of the
I’ve seen people say, ‘This is my dream
sales involving real estate; only automobiles outpace houses. And this revenue
home. I’ve always wanted to live
doesn’t include online auctions for real estate, which are also growing in popular-
somewhere like here.’ I’ve seen them
ity from Iowa to Israel.
be so overjoyed that they cry.”
In fact, according to a 2004 Harris Interactive study, commissioned by the NAA,
The goal, however, is not to cry
92 percent of consumers held a very favorable view of the auction profession, and
because you’re devastated and overbid for
the top reason consumers go to live auctions is to have fun. They’re looking for an
a house or commercial property that you
exciting way to get a good deal, and while it may not be quite like a visit to Walt
can’t afford. Because generally, as Tarver
Disney World, 75 percent of consumers would consider taking their family; they
says, these contracts are “ironclad.”
see real estate auctions as a potential family outing. The study also determined
Start the bidding
that the greatest barrier to people participating in auctions is the lack of informa-
tion in knowing where to find them and how to get involved.
OK, yes, this is a tense moment,
but you probably don’t have to worry
With that in mind, there are myriad prestigious, reputable auction houses and
about accidentally bidding on a dilapi-
auction-locating sites. For a start, check out these Web sites:
dated, haunted mansion that you’d then •
realtybid.com
have to live in. After all, real life isn’t •
realestateauctionguide.com
a sitcom, right? •
sheldongood.com
“I do tell people not to yawn and •
www.jpking.com
stretch or touch your ear,” says Klein. •
sea2thed.com
“But I think a good auctioneer will be •
nrc.com
able to determine whether a bid has •
tranzon.com
growingwealthmag.com I Growing Wealth I July 08 I 35
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