Auction method used for
many land parcels as well as
residential and commercial
properties

Auctions are a popular method of sale for not only residential real estate today, but also acant land and commercial properties. In recent months, much national attention about auctions has been focused on the hot niche of auctioning residential homes and condominiums.

But many owners of vacant land are also choosing the auction method as their preferred method of sale, instead of traditional listing. For example, 72 parcels of federal land in Colorado were auctioned in recent weeks, raising $8.2 million. The state and federal government will split the proceeds. The Bureau of Land Management auction included 23,183 acres in the South Shale Ridge area near DeBeque, about 210 miles west of Denver and in one of the state's hot spots for natural gas drilling.

And in Seattle, WA officials plan in 2006 to sell by auction more than $60 million worth of land they originally bought for train stations for a mass-transit monorail, but the monorail project was rejected in an election by voters recently. This property stretches over 14 miles.

Many times a large number of vacant lots are sold in one auction called a “multi-parcel auction,” which is often held at a hotel ballroom. Screens at the front of the room show the crowd the bids on each piece of property. Bankingr epresentatives are often on site to help with financing questions about a purchase. The multi-parcel auction process is clearly explained by the Auctioneer to the crowd. Many bidders have come to enjoy this type of auction and look forward to seeing who the purchasers are and what prices are obtained.

Sellers like the fact that a competitive atmosphere among the crowd helps get good prices and that an auction helps find a buyer a sale on a certain day, instead of letting land languish for months in a traditional listing. Baby boomers today, and in coming years, are inheriting vacant land, homes and commercial properties at a greater rate than ever in the past, and many of these owners are choosing auctions as the way to effectively sell those properties.

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From the NAA Auction Advantage Newsletter, Winter 2006. National Auctioneers Association - www.auctioneers.org