When it comes to auctioning farmland, an auctioneer needs to bring more to the table than handing out numbers and talking fast. In order to streamline the process and make sure both the buyer and seller receive the best treatment, a company requires knowledge of crop production, market conditions, agricultural finance and real estate. Sometimes land ownership crosses state lines; in those cases, GFM can facilitate auctions that demand licensing in multiple states.
Glaub Farm Management offers successful auctioneering services for land and farms that include all of the above as well as a guarantee that your land is exposed in the right markets locally, regionally and nationally.
Because we have such expertise in the field, you might even consider a land auction over a real estate listing if you want a guaranteed sale date with, typically, a shortened marketing period. Auctions can deliver an open and fair market price by forcing buyers to simultaneously compete for your land and farm. This competition creates unlimited upside selling potential while openly allowing any interested party the opportunity to buy land.
Contrary to popular belief, there are multiple auction strategies for land sales. We would be glad to discuss them with you and determine whether an auction is the best option for your real property. To schedule a consultation, fill out the form below and we’ll get in touch with you as soon as possible.
Types of Auctions:
Absolute
As a general rule, the absolute method is the best to get the highest possible price at auction because it generates a much greater interest among potential buyers, resulting in greater attendance at the auction. Thus, the property receives more committed bidders. The more competition for the property, the higher the price achieved. The word “auction” creates a sense of urgency and causes people to react; the phrase “absolute auction” ensures that no interested buyer will miss the auction.
Published Minimum Bid
To generate motivated bidders, we can also use published minimum bid (PMB). This lets the market know that you are serious about selling. The amount that is used for a PMB is usually 60% of the last listed price or appraisal for land. While this number seems low and is below what you would like to actually receive, it lets the market know that the property will sell because everyone knows that the value is higher than the amount. Therefore, the bidders will create the competition needed to drive the price up to a more reasonable number.
Reserve
With reserve auctions, you have the right to accept or decline the highest bid. While this method seems the safest for the seller, prospective buyers assume that the price expected at the auction is very high. A reserve auction may also cause some prospective buyers not to participate because of the uncertainty the land will actually sell at the auction.
Multi-Tract Approach:
Multi-tract real estate auctions provide a way to increase the sale price when property can be split into multiple tracts. At a multi-tract auction, bidders can bid on one tract, a combination of tracts or the total. By splitting a property into tracts, the owner allows the smaller bidders to compete against the larger bidders, which may push the sum of all tracts to a higher price than the bid price of the whole. Multi-tract real estate auctions are so effective that an individual with different land use properties—or even neighbors—can collaborate to maximize their real estate sale.
Using Technology To Improve Auction Results:
Technology has created opportunities to expand auctions and bidder participation. Our technology allows a single tract or multi-parcel tracts to be sold in the traditional in person live, webcast, simulcast, or online-only bidding. As long as internet connection is available, we can host a simulcast which allows in person bidding and online bidding at the same time. The online bidders can follow a video and audio stream along with real-time bidding and updates to the current bid price. Simulcast expands the participants by providing bidders who are unable to attend a live event and those who prefer anonymity. Webcast is similar to live only in the fact an auctioneer begins and ends the bidding live through a video broadcast. In this methods, the auctioneer is live streamed but all bidding in though the online bidding platform. Online-only auctions are another way to maximize a sale in a timely and cost-efficient manner by allowing all participants to bid 24/7 until the auction ending time. We can extend the closing time by a few minutes each time a bid is made during the final count down to make sure all bidders have a chance to make their highest and best bid. Online bidding can also take away social pressure that some bidders feel not to bid against friends and community members. We know who is bidding online but the participants do not who is bidding against them. View our online bidding platform and current auctions here.
Choices. Choices. Choices.
Our experience in real estate and land auctions creates choices in selling methods and auction types. As we discuss your property, we can decide together the selling method to maximize your price and selling time frame.