Introduction to Auctions

When people think of auctions, most often they think of antiques, rare collections and household items such as furniture and dishes. But truth be told, most every item imaginable has been sold by the auction method including business equipment, artwork, livestock, industrial machinery and automobiles.  Can you guess what is the most rapidly growing area in the business? The most rapidly growing auction area is real estate. That’s right – buying and selling homes and property by the auction method of marketing is becoming more widespread each year.

Growth of Real Estate Auctions

So what has led to this rapid growth? Well, a number of factors.   Changes in the real estate industry at both the residential and commercial level have set the stage for growth and wider acceptance of auctions. Until the 1980s, auctions labored under a negative image as the real estate industry’s last resort for distressed property. The turnaround started with the recession of the 1980s when auction firms proved that auctions could succeed where traditional real estate methods failed.  This trend quickly caught the attention of the National Association of Realtors and they began to recognize auctions as a viable sales and purchase option.   Another source of growth comes from the widespread economic influence of the baby boomers. As a generation, boomers are inheriting at an unprecedented rate in history, and auctions offer a faster and more viable method of liquidating assets.

Live auction industry revenue is projected to grow $7.6 billion (3%) in 2007.