Real Estate Auctions (How Do They Work)

The popularity of auction sales of real estates is increasing day by day despite the dominance of the traditional process of real estate selling. Earlier these auctions were labelled as dishonour sales done by the distressed sellers when there was no other way to liquidate a property. But this view has changed as the number of real estate auctions are increasing day by day because sellers of residential as well as commercial properties are opting to auction their property directly or turning to real estate broker houses to get top price as per market rates from the auctions.

Auction opportunity arises when a seller’s mind is auction oriented with a hope that the property will fetch a fair market price. To get a fair price, his equity position in the auctioned property should be strong. With a strong equity position in the property, he will save the cost of paying a sales commission. The time of auctioning should be perfect, when the market is soaring high. The auctioneer should also try to avoid bearing high carrying costs associated with the property.

A profitable auction opportunity is created when there is limited supply of a particular type of property whose demand in the real estate market is relatively high or the market is declining with limited buyer’s interest in this traditional sales process.

When a property is offered for auctioned, a sense of urgency arises to bring the interested parties together on a particular day and the sales process creates a sales price through competitive bidding among the participating parties.

In early days of real estate auctions only the properties in bad conditions or subjected to foreclosure were auctioned. But now sellers are shifting to real estate auctions to sell their homes. This transformation has occurred because the earlier believe that a seller will not take the risk of auctioning his property at a lesser price than its market value has changed. Real estate auctioneers are at a liberty to set a minimum price which is more than its market value that he will receive in any case. In addition by setting a minimum price, he will no longer have to bear the risk of buying back the property if it does not reach that price and will also save the cost of paying the required sales commission to the auction house.

Many real estate owners prefer to go for a direct auction instead of going to a auction houses to avoid payment of sales commission to real estate brokers which is about 8-10 percent of the property’s value. Also the property owners have absolute control on the auction sales process. This is essential when a real estate takes lot of time to sell and the owner is represented by a real estate agent or broker. Many times, it is wise for a real estate owner to auction a property not in use to cut down maintenance expenses. Real estate auction is an exciting event both for the auctioneer and the bidding parties therefore they are always well attended.

Since auction is the best way to get true market value for the real estate, the magic of an exciting real estate auction works for the marketing of these properties for sale. Onus rests on the auctioneer to create demand or an urge to make a bid in the buyers/bidders mind and to attract the attention of the potential buyers/bidders. The potential buyers of the property are then registered after it is ensured that they are financially qualified. It is to be ensured that a considerable sum is paid by the buyer as a down payment which is non refundable and both parties are willing to close the deal as soon as possible. It is necessary to make sure before the auction that the buyer is financially secure so that the seller will not have to wait for receiving the entire payment. Many times it has been found that real estate auctions remain incomplete because the buyer or successful bidder is turned down for mortgages.

The following factors should be kept in mind before a real estate is auctioned by the property owner-

. He should consult experienced and professional auction consultant who have specialized in real estate auctioning.

. It should be ensured that the marketing campaign of the auction event focused properly to have a high impact.

. Importance should be given on direct mail marketing to targeted bidders/buyers.

. The auction event should be advertised in print and audio visual media to have a greater impact. If possible the consignment should be assigned to a reputed advertising agency to make the ad campaign more attractive.

. The auction event should also be advertised through internet and email.

After the promotion or advertisement campaign is launched, the auction event takes place within a few weeks on completion of official formalities. Sellers are informed about the auction date before hand after the auctioneer is ensured that the sellers/bidders are able to meet the preset terms and conditions laid down by him.

Following are the advantages of real estate auctions for the seller-

. The property owner is able to make a quick liquidation of their property.

. The auction is successful in creating a healthy competition among the bidders.

. Their property is exposed to a wide range of prospects.

. Closing is accelerated.

.The sellers are well aware about the date and time when the property will be sold.

. Auctions are successful in considerably bringing down the amount of time a property is on the market for sale.

. Auction gets rid of number of out of the blue events related to property sales.

. Auction reduces the burden of negotiation process from the sellers mind. He is able to sell the property according to the terms and conditions set by him.

. In contrast to conventional sales processes where it is mandatory for the property owner to make necessary improvements and renovations to get a fair price, these properties are auctioned on as-is-where-is basis. Potential buyers receive enough time to make a decision on whether to make a bid or not after having a good look at the property to be auctioned. Therefore it is sold with no emergency and the seller gains from it.

The buyer also enjoys innumerable advantages from real estate auctions, they are-

. He can set his own purchase price.

. He purchases the property at a fair market price.

. He does not have to make long negotiations or bargains to finalize a deal.

. Auction reduces the time to purchase a property.

. He will not have to worry about emergencies because purchasing and closing dates are known to him beforehand.

. Buyers are well aware that sellers are predetermined to sell.

The Brilliance and Strength of Home Based Businesses

Have you ever considered how many small home-based businesses there are in the United States? Well, nearly half of all city business licenses are that of home-based businesses. And did you know that 10% of our US population is self-employed, that means 30-million people work for themselves and half of them, or 15 million people are thus, small home-based companies.

That is truly amazing isn’t it, “But ain’t that America – home of the free?” Yes, why yes it is I am happy to say. And in America we are free and we have the right to free contract. This means just about anyone can start a business, and if you start a home-based business you don’t need much money to get started.

Now then, why do you suppose that there are so many people who are self-employed working from home? Simple! It’s efficient, and that my friends, is the brilliance of it all. And you can bet with 15-million people working from home – there is strength in those numbers – big time!

Indeed, starting a home-based business is quite efficient, there is not a lot of costs, you don’t have to commute, you don’t need to sign a ten-year lease for an office space, and there are tens of hundreds of different professions you can run right out of your home with merely a computer, a fax machine, and a telephone. The strength of home businesses is really the simplicity.

Okay so, let’s say you want to start a business from your home, and let’s say you are ready to take the entrepreneurial plunge. Well then, what kind of business might you start? There are so many different types of choices; it’s hard to pick one. However, you should give a little philosophical thought to all this.

Think about what types of services and products are most desired and needed, then figure out how you might go about providing those to people that are willing to pay. Maybe you want to start a business opportunity or franchise type business where someone has already figured out the business model and all the details, and all you have to do is take yourself and plug and play.

Maybe you might be interested in a network marketing type business? Perhaps you’d like to be a consultant, or maybe get a license and become some type of professional such as a financial planner, an insurance broker, or some sort of other specialist. The great thing is there are so many choices of different types of businesses you can run out of your home, that there is really something for everyone. Indeed, hope you’ll please consider this.

Online Open Source Education

Online education is increasingly on the public’s mind with many pursuing higher education during the current tough economic times. Accompanying the growth of the for profit online universities, serving these students, is the open source education movement. This movement, headed by MIT OpenCourseWare and the Khan Academy, seeks to revolutionize education by offering free content to anyone with an internet connection. Bill Gates said in an interview that he believes that within five years the best education will come from the web. Coming from a man who has made billions from investing in innovation, such predictions carry an enormous amount of weight.

There is a huge demand for online education materials, not just for those enrolled in online courses, but for anyone trying to learn. The upcoming generation of college freshman have to think hard to remember a time before Google and YouTube. Therefore, it is not surprising that the first reaction of many young students when faced with a difficult problem is to “Google it.” Interestingly enough, with the plethora of online education materials, it probably is the best strategy. A quick Google search for calculus returns quite a bit more than what one could find in a traditional library. Full textbooks, video lectures, practice problems with solutions, internet forums connecting to thousands of helpful experts, computer programs, and more content growing by the day make a trip to the library seem silly unless you plan on using a library computer to access the internet.

So where is the open source education movement taking us? Despite the enthusiasm of many, I do not foresee the destruction of the over priced higher education system (bubble?) any time soon. Although, it would be an interesting case study to submit a few resumes with a list of watched YouTube videos as one’s education credentials. The open source education movement will have an effect, however, in the industry that produces supplemental education materials. There is a whole section of “Learn Calculus Fast!” style education books that could be disappearing off the shelves of your local book store (if your local book store hasn’t already disappeared). How are they to compete with interactive online materials, video lectures, and discussion forums for these subjects? Quite frankly, I don’t see how they can.

More interesting than the business impact of the open source education movement is the psychology behind it. What is driving people to produce their own YouTube videos solving calculus problems? Or spending their evenings in a forum devoted to organic chemistry, helping students with difficulty understanding the concepts? Economists and psychologists came together to find what motivates people to contribute to open source projects and found three primary motivators. Challenge, mastery, and making a contribution are the driving force behind all open source projects. These three elements are clearly prominent in the case of the open source education movement and one can add in the “joy of teaching” as an additional motivator. It is for these reasons that I agree with Mr. Gates that not only will the best education soon be available on the web, but that it will also be free.