When the Seller Has the Right to Think About It…August 31st, 2007 by PA - Bloger
Some auctioneers in certain pockets of the country seem to be constantly changing the terms of sale. With the changing markets this is to be expected but how does giving the seller the right to think about the bid for a certain period of time affect the auction?
In the past we have seen the option for the seller to think about the bid for up to 24 hours before having to confirm acceptance however buyers are really starting to grow weary of leaving their deposits in this often times unfruitful exercise. Buyers claim the sellers should be under the same pressure as them to make a decision on the spot.
“The auction will not be absolute, the [sellers] will have up to 10 days to review any offers made on the buildings before they reject or accept the offers.” This is a little much for a private individual seller or small group. This scenario would be more understandable for an institution or a lender in a case in which the bid comes in below what was acceptable and several committees need to sign off on accepting the low offer.
Typically buyers come in at a number considerably below what they had bid (or were willing to bid) at the auction in the “post auction” market. No real data is available to be able to affirmatively state whether the practice of letting the seller “think about it” is helpful in getting properties at auction sold or not.
You can leave a response, or trackback from your own site.