Land Auctions - Brining the Market to You
Land Auctions - Brining the Market to You
Land Auctions - Brining the Market to You
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From <strong>the</strong> expansive, rugged terrain of West Texas<br />
<strong>to</strong> <strong>the</strong> lush, rolling estates of <strong>the</strong> Hill Country, <strong>to</strong><br />
working ranches and fertile farmground scattered<br />
throughout <strong>the</strong> state, Texas is uniquely identified<br />
across <strong>the</strong> United States and around <strong>the</strong> world by <strong>the</strong> diverse<br />
terrain and iconic landscapes that have shaped its his<strong>to</strong>ry.<br />
For property owners, <strong>the</strong> unique character and diversity that<br />
defines Texas and draws in visi<strong>to</strong>rs from around <strong>the</strong> world can<br />
create difficulty when <strong>the</strong> time comes <strong>to</strong> consider selling.<br />
As a landowner, where do you turn when it’s time <strong>to</strong> sell your<br />
premium agricultural property?<br />
Traditional real estate markets are very effective when selling a<br />
home or o<strong>the</strong>r property with a lower price point. The success<br />
of this approach often relies on market continuity and data<br />
collected from comparable sales—both of which are often<br />
unavailable for one-of-a-kind farm and ranch land.<br />
As <strong>the</strong> complexity and value of a property increases, <strong>the</strong> pool<br />
of potential buyers decreases. And in <strong>the</strong> case of premier farm<br />
and ranch real estate, <strong>the</strong> higher<br />
value of <strong>the</strong> property also limits<br />
<strong>the</strong> number of buyers with <strong>the</strong><br />
financial means <strong>to</strong> purchase. The<br />
result for owners of premium<br />
agricultural land can be pricing<br />
guesswork that may ei<strong>the</strong>r<br />
overvalue a property and result in<br />
excessive days on <strong>the</strong> market or<br />
undervalue a property and lead<br />
<strong>to</strong> a quicker sale but a discounted<br />
return. Even with <strong>the</strong> very best land agent, unique, high-value<br />
rural properties with a limited pool of potential buyers may<br />
linger on <strong>the</strong> market with little interest in a traditional listing.<br />
Toge<strong>the</strong>r, <strong>the</strong>se fac<strong>to</strong>rs may amount <strong>to</strong> planning uncertainty,<br />
lost dollars, and indefinite carrying costs for landowners.<br />
❝AUCTIONS PUT SELLERS BACK IN<br />
THE DRIVER’S SEAT WHEN PUTTING A<br />
PREMIUM AGRICULTURAL PROPERTY<br />
ON THE MARKET❞<br />
The National Auctioneers Association estimates that in 2010,<br />
more than 24 percent of all auctions involved real estate<br />
transactions. And beginning in 2003, residential, farm, and<br />
ranch real estate represented <strong>the</strong> fastest growing segment of<br />
auctions conducted nation-wide. In 2008, land and agricultural<br />
real estate auctions represented an estimated $26 Billion in<br />
sales volume.<br />
There are a number of key benefits for sellers, brokers, and<br />
buyers alike that can be achieved when offering a property at<br />
auction—and <strong>to</strong>ge<strong>the</strong>r, <strong>the</strong> following advantages are making<br />
auctions a more and more frequent choice for discerning<br />
landowners.<br />
Sellers are figuring out that auctions provide an accelerated<br />
marketing alternative that puts <strong>the</strong>m in <strong>the</strong> driver’s seat and<br />
eliminates <strong>the</strong> hassle of a drawn-out listing and negotiation<br />
process. An auction brings <strong>to</strong>ge<strong>the</strong>r a pool of potential buyers<br />
at one time, creating excitement and competition that offers <strong>the</strong><br />
fastest way <strong>to</strong> reveal <strong>the</strong> true-market-value on any property.<br />
An auction eliminates <strong>the</strong><br />
guesswork often required in<br />
pricing high-value, premier<br />
agricultural properties. On<br />
auction day, <strong>the</strong> auction process,<br />
in real-time, uncovers <strong>the</strong> market<br />
value of your property.<br />
A successful auction requires<br />
multiple willing and able buyers<br />
competing for a property. Both<br />
through <strong>the</strong> multi-parcel auction process and a concentrated,<br />
dynamic marketing campaign, <strong>the</strong> lead-up <strong>to</strong> auction day must<br />
be thoughtfully executed <strong>to</strong> maximize <strong>the</strong> number of bidders<br />
at <strong>the</strong> table and <strong>to</strong> enhance <strong>the</strong> urgency and excitement<br />
generated by a property auction.<br />
But this paradigm is shifting.<br />
Unlike ever before, owners of hard-<strong>to</strong>-value, premium<br />
agricultural properties are turning <strong>to</strong> auctions. For <strong>to</strong>o long, <strong>the</strong><br />
marketplace has viewed auctions as a last-resort, fire-sale <strong>to</strong>ol<br />
for flawed properties. But thanks <strong>to</strong> success in <strong>the</strong> luxury home<br />
market and in <strong>the</strong> sale of expansive ranches in <strong>the</strong> nor<strong>the</strong>rn<br />
tier of <strong>the</strong> U.S., this perception is changing. From small rural<br />
homesteads <strong>to</strong> sprawling farmland holdings, cus<strong>to</strong>mized<br />
auction approaches can and are delivering premium sales<br />
prices for property owners across all parts of Texas.<br />
Multi-parcel (multi-par) auctions divide properties in<strong>to</strong> multiple<br />
tracts, expanding <strong>the</strong> number of purchasing options – which<br />
in turn expands <strong>the</strong> pool of potential bidders. Bidders arrive<br />
on auction day with full knowledge of <strong>the</strong> property and ready<br />
<strong>to</strong> buy. With <strong>the</strong> multi-par process, bidders have control over<br />
exactly which property <strong>the</strong>y want with <strong>the</strong> option <strong>to</strong> bid on one<br />
tract, bid on a few, or bid on <strong>the</strong>m all!<br />
To achieve a successful outcome on auction day, landowners<br />
should look for a dynamic, professional marketing effort<br />
leading up <strong>to</strong> sale day that showcases and intensively markets<br />
a property <strong>to</strong> <strong>the</strong> audiences most likely <strong>to</strong> buy. A typical<br />
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