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How to Start Your Own Real Estate Auction House

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Earlier real estate auctions were relevant only to investors. Now this online spot is accessible for an average consumer too, as it’s a good opportunity to find the best deals. 

Thus, nowadays it’s more often seen a predisposition to purchase apartments and houses through online real estate auction websites. Besides, many entrepreneurs strive to start their own real estate auction house. Let’s observe why this field is so attractive.

What is an auction house and how does it work?

Auction house is a place where its members sell their goods, either cars and real estate or works of art and other things that mostly have value and its own history. The main peculiarity of such a business model is its pricing system. Selling process doesn’t go as in habitual points of sale. Auction buyers take part in a so called bidding procedure to get a specific item, so called lot. More details regarding auction structure will be revealed further on the example of online property auctions.

For potential online real estate auction holders it’s useful to know what is its target audience. Generally, it’s people who want to buy or sell property fast and profitable at the same time. Among them are real estate owners, agents or asset managers. 

Every auction house may have its individual rules. Some auctions support free registration, the others require a specific license. 

The biggest plus of auctions, which mostly attracts buyers, is exclusive offers that might not be made anywhere else.

Online real estate auction holders usually take a percentage fee from the closed deals, and that’s their main source of income.

The most vital steps to start your own real estate auction house

Both the buyer and seller needs must be taken into consideration while deciding what features your future online real estate auction house will have. And don’t miss all probable controversial situations. 

Here is a slightest amount of requirements an online auction website should meet:

  1. Account registration. It is the first thing your potential clients will face visiting an online auction website. A visitor must fill in a basic account registration form that includes lines with login, email address, physical address, zip code, contact number and different optional sections for social media links etc.

    Once a customer’s email address is added to a website database, his account will be verified, and it’s possible to notificate him about all significant events further. When property investors and agents register on your website, it’s preferable to state their corporate position and provide real estate license.

  2. Putting property for sale. Real estate owners must be able to add their items to a website. It can be available for free, or an online auction portal may ask for a fee per item. Give retailers an option to enter a description of their position, settle the bidding period (a time when property is exposed to bidding), download mansion photos and much more. Create one more area, which will contain rights, obligations and conditions. For instance, the payment method an owner accepts.

  3. Search engine. Your online auction website potential users will be highly satisfied with a fast search function, especially when they will have the opportunity to mention certain peculiar points, related to wanted property. In this case filters will definitely come in handy. With its help consumers should specify such details as location, lot cost range. If you apply a geographical map extension, it would always make a good impression.

  4. Online real estate auction bidding procedure. This event is specified by a property owner. Its duration is determined by the set time or by the amount of bidders. Web page of bidding procedure should introduce exhaustive statistics of every auction position, for example how many users visit a page, average bid number, maximum bid number and so on. You can saturate your bidding web page with extra tools, for instance:

  • A bidding countdown clock - a timer that sets the time within which a bid must be raised. If it’s not raised for a long period of time, the latest participant with the highest bid wins;

  • Automatic bidding via proxy software is a perfect instrument to provide persistent auction participants with. It aims to remain user on the highest position and contributes to auction result in his favor;

  • Buy It Now Option is a good choice for users, who have determined their budget and are willing to finish a real estate deal immediately.  

  1. Closing the bid. All in all, a perfect seller finds his perfect buyer. Everyone is happy and continues with the next step - signing a contract. It must clearly state all the conditions to finalize a deal and the time range for financial and other responsibilities of contract sides. Everything is happening under control of an authorized office. Eventually, an authorized office conducts all arrangements needed to officially pass on real estate ownership to an auction winner.

  2. Schedule. It’s a distinct website section, which includes a calendar that brings together potential events, associated with a buyer chosen lot. Besides, a service for updating users about their actual auction approaching should be integrated too. 

  3. Bidding panel. This configuration is not less important. Every online real estate auction member must have a certain area in his account to manage and track all activities. Bidding panel appears on a website in the form of a dashboard, which is supplied with the next spaces:

  • Favorites is a useful section, where a customer creates a list of lots for subsequent consideration;

  • Notifications. It’s a good addition to essential email notifications that can be frequently skipped by users;

  • Bids management.  You can ease users’ search process by letting them put a bid on an actual position straight from their account rather than looking for them manually.

Conclusions

Even though auction houses are being seamlessly digitized, the firm structure of a good old on-site auction must be always persistent. Hence, all mentioned above functionalities may serve as a driving force to start your own real estate auction house. You should ensure your website doesn’t lack any feature that is crucial for online real estate auction. Hope, now it’s more clear how to proceed. Good luck with your second eBay!

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