New to the Florida Auction Process?
Real estate auctions in Florida are growing in popularity, and they're not just for fixer-uppers and homes in foreclosure anymore.
Individual sellers, real estate agents, and even builders are beginning to turn to auctions.
Whether the auctions are conducted live or through an auction Web site, the process is generally the same:
Sellers put their homes on the block, and determine how long the auction will be listed, and the price.
Bidders are then invited to inspect the homes and then, the auction is opened.
There are basically three types of auctions: reserve auctions, minimum bid auctions, and absolute auctions.
In a reserve auction, the seller sets two prices -- the initial bid price, which all bidders will know, and a reserve price,
which is the minimum amount the seller will accept from any and all bidders. The reserve price is not disclosed to bidders,
who are only told that there is a reserve price. Once the bidding has closed, and if no bids exceed the reserve price, the
highest bid is reduced to an offer and the seller has the right to accept the bid within a specified amount of time.
Buyers try to guess the reserve price by entering low initial bids and receiving messages that the bid failed to meet
the reserve price. Indeed, their bids won't be accepted until they enter a bid that is at least enough to meet the reserve.
In a minimum bid auction, the auctioneer only accepts bids above a published minimum price.
In an absolute auction, "the most exciting type of auction," there is no reserve price, so the property will be sold to the highest bidder, regardless of price. Since a sale is guaranteed, the bidder must be prepared to have his or her bid accepted, and buy quickly.
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