Farmland Auctions: What They Are & Why They Work

 



Farmland Auctions: What They Are & Why They Work

What do you think about when you hear the word ‘auction’?

Your first thoughts might be anything from selling off household items, automobiles or someone lost their property to the bank.

What you might not immediately think of, is farmland auctions, which are promoted, held, and conducted in a much different way.

For decades farmland has been sold at auction and is actually the preferred avenue for getting the most money. During a farmland auction, all bidders are on a level playing field, contingency of financing is not allowed, and everyone is permitted to bid as high as they want. Serious buyers quickly stand out while fly-by-night participants are weeded out. 

There is a common misconception that when a property goes to auction, that method of sale is the last resort…  Not so, this method of sale is often the first and best way to sell property. Farmland auctions are often conducted with the current owner in full control of the sales price they accept, it is just an option of sale that is available.

In most situations there are limited downsides and many upsides when it comes to offering a property to the market in this way. That being said, an auction is no place for setting unrealistic expectations as the property owner. A real estate broker with experience in this method of sale and a good understanding of farm values will be able to provide some estimates for the final sales price. However, if the highest bid does not meet expectations, the owner does not have to accept it. Most owners are not aware of that ability, but it is a card they can play.

Other asset classes are quickly catching on to the auction method of sale including industrial property and office buildings. The process can often move more quickly than a typical listing and with tactful marketing efforts, owners are being well served.

If you would like to talk about the auction method of sale for your property, no matter the class, give me a call. We can talk about the process, discuss comparable sales, and determine if this is the right move for YOU!

Brad Neihouser     

765 427 5052

"Cut through the noise. Get straightforward advice."


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