Frequently Asked Questions
- Who is Action Property Auctions and how long have you been in business?
Action Property Auctions (APA) is a name our real estate company has created specifically to facilitate doing auctions. Our real estate company, County Property Exchange (CPE) has been in business since 2002. CPE has assisted dozens of clients with either the purchase or sale of property. CPE has also been very involved with foreclosures, bank owned homes, commercial property development, short sales, construction, remodeling, staging, commercial lease negotiations, corporate office acquisition, and corporate relocation assistance. We are members of the National Association of Realtors, the California Association of Realtors, and the Santa Clara County Association of Realtors.
- Why use a different name?
We felt that in advertising the new venture, we should have a name that reflected exactly what was being offered. We spent over a year researching and studying various auction methods, and developed our system using what we learned from the best practices of those companies.
- How many real estate auctions have you been involved in?
Since the beginning of our company, we have attended or been involved in over 2000 auctions either as a buyer or seller. They include foreclosures auctions, tax default auctions, probate sales, adjudicated auctions and private property auctions.
- Why should I use APA instead of another auction company?
APA is a local company and we specialize in Santa Clara and San Benito counties. Everything we do is customized to this marketplace, and our executive staff is personally involved in every auction. Our system is designed to maximize the seller's financial return while minimizing the disruption to their personal home life.
- How are you planning to market the auction?
The home will be placed on the local Multiple Listing Service (MLS) and web sites (Yahoo, HomeAdvisor, Homes.com, Google, Oodle, Trulia, and our CPE and APA web sites). We place large print ads in the local paper for the 10 days leading up to the auction, a large 4X8 ft yard sign is placed in the front yard, and we use 10 large oversized 'house auction' signs that are placed strategically during the open house/ inspection periods. In every advertising medium, a low "opening bid" is advertised to attract attention. It's not uncommon to have 150-200 visitors view the home during the auction previews.
- Can I set a "reserve price"?
Yes. We will provide a CMA, Competitive Market Analysis, to assist in determining the true value of the property based on traditional selling methods. The reserve is then established based on those discussions. At all times the seller controls the sale of the home, and can refuse any unacceptable bid.
- How do we establish the "opening bid price"?
The opening bid price is determined by the marketing plan created by APA, and the seller. The opening bid price may or may not be related to the reserve price.
- What if I reject the high bid?
All contracts between APA and the seller are based on the reserve price. If the seller rejects a bid that meets or exceeds the reserve, commissions to APA are considered earned and therefore due. Should the high bid fail to meet the reserve, the seller has the right to refuse the bid, or make a counter offer to the bidder. If no transaction results, no commissions are owed.
- Can my house get sold without my approval?
Absolutely not. The seller is always in control of the process.
- Why should I believe that an APA auction will work?
The reason our auction method works is because it's a focused, high energy event that directs everyone to 1 property. In many auctions held in ballrooms, they may auction 100's of properties in an afternoon. We only sell 1 property at a time. Most buyers are used to viewing multiple properties in an afternoon, and then deciding which home to buy. In our auctions, we attract dozens of potential buyers who must compete for your house. We spent over a year researching and studying various auction methods, and developed our system using what we learned from the best practices of those companies.
- Are there any upfront costs?
Yes, we will order numerous inspections and reports. They include a home inspection, termite inspection, appraisal, title report and a Hazardous disclosure package. The title report is free, and the cost for the other inspections and reports is approximately $900.
- What must I do to prepare my home for an auction?
We will meet with you to determine what needs to be done. Often, the only things that need to be done are cosmetic and are common upgrades or repairs most sellers should do to best market their home. In the event that projects are greater than you wish to perform, we can recommend quality contractors to assist you.
- Will an Auction work if I financed 100% and I've only owed the home for a short time?
Probably not. Unfortunately if you've financed 100% of the price you purchased your home for, there probably hasn't been enough time to build up the required equity that's needed to sell your home.
- Will an auction work if I need a "short sale"?
No. Lenders usually require weeks to make short sale decisions, and auctions are designed to expedite the process.
- Does selling at auction mean that I have to sell my house cheap?
It really depends on the home, and where it's located. If you're in a highly desirable neighborhood, and have a really nice house, you may experience a very competitive bidding environment. Auctions are designed to attract multiple buyers who must compete for one home, which often works to the benefit of the seller. Obviously, if your home presents challenges either in condition or neighborhood, consider that since we're asking buyers to make instant decisions, prices may be lower than in a traditional selling model.
- Aren't auctions for foreclosures or distressed situations?
Yes and no. Obviously many homes that are in foreclosure or are distressed are sold each year at auction. In many areas, auctions are the only way homes are bought and sold. In Northern California, auctioning single homes is a fairly new way to sell. We have studied various auction companies around the country who specialize in the single home auction, and believe we taken the "best practices" to create our auction format.
- What do you do to make the buyer comfortable with the auction process?
Good question. In most home buying contracts, there are time periods allowed for the buyer to order and review various inspections. In an Auction, we're asking the buyer to make an instant decision. For that reason, we order all of the standard inspections, plus an appraisal, and give those to potential bidders in a nice binder. The potential buyer can then review everything they need in order to make an informed bidding decision.
- How is escrow and title handled?
We open an escrow account with a local title company who handles all of the details. Once the transaction has concluded, the escrow office assures that the seller has received their money, and the buyer has received clear title. Our office coordinates the entire process.
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