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. GFM can facilitate auctions that demand licensing in multiple states.
Glaub Farm Management offers successful land auctioneering services 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 an 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. This competition creates unlimited upside selling potential.
Contrary to popular belief, there are multiple auction strategies—we would be glad to discuss them with you and determine whether an auction is the best option for your property. To schedule a consultation, simply fill out the form below and we’ll get in touch with you as soon as possible.
Types of Auctions:
As a general rule the absolute method is the best method to get the highest possible price at auction. The reason is that an absolute auction generates a much greater interest among potential buyers resulting in a greater attendance at the auction and in the property receiving 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” insures that no interested buyer will miss the auction.
Published Minimum Bid
The next best method to generate motivated bidders is using 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 come and the competition with drive the price up to a more reasonable number for you.
With a 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 sale at the auction.
Multi-tract real estate auctions provide a way to increase the sale price when property can be split into multiple tracts. Under a multi-tract auction bidders can bid on one tract, a combination of tracts or the total. By splitting a property 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 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.