Real Estate Auction Options Principal Gary Gilbert discusses luxury real estate auctions for both sellers and purchasers.

Misleading "Absolute" or "Without Reserve" Luxury Home Auctions Still Prevalent

By Gary Gilbert on
Gary Gilbert
I have been involved in multi-millions of dollars worth of luxury real estate au
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It's been a while since I wrote about the topic of the bogus "absolute" or "selling without reserve" auction as it relates to luxury home auctions.  Let's pick up the topic again today as it seems to me that the bait and switch is being used today more than ever, in particular by one firm who on the surface appears to be legitimate.

So, why should this concern you as an agent or as a private seller considering a non-distressed luxury real estate auction?  Because it opens the door for litigation for you as a seller or agent while eroding the buyer base interested in purchasing a high end home at auction.

Here is how the bait and switch happens:  A luxury real estate auction company tells their seller that they will advertise the event as "absolute" or "without reserve" which in theory should generate a high amount of interest from potential buyers.  I say in theory which is true if the event is a legitimate absolute auction.  The company tells the seller that they will cancel the auction a couple of days prior if the interest is not sufficient.  I've been dong this a long time and can tell you that most of the best buyer candidates surface the day before the auction.  By cancelling, one is not giving the auction a chance to work.  If this is even a possibility, any firm should simply pass on the business in the first place.  Not to mention the unsuspecting buyer.  Imagine that you as a potential buyer have traveled and are ready to bid only to find that the event has been cancelled.

I can't tell you how many times this happens.  The auction company quietly cancels the event and then spins the true results in media.  Consider it a big red flag if you hear that an absolute luxury home auction sale is "pending" or my favorite- it has been postponed due to overwhelming interest.

We can dig into this very important topic when we speak.  Reach out anytime to discuss this topic or anything else prior to signing anything with any company.  I'm happy to help.



Tags: absolute luxury real estate auctions, absolute luxury home auctions, absolute real estate auctions, absolute luxury real estate auctions


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