Absolute Auction

Absolute Auction means highest bid wins, regardless of price. The typical result? More money for the seller because bidders tend to have much more interest in Absolute Auctions, and that means more and more competive bidding. 

Minimum Bid Auction

Minimum Bid Auctions begin at a minimum price established by the seller. Bidding must begin at least at that minimum before there can be a sale. The minimum bid is published in the brochure and announced by the auctioneer at the start of bidding for that particular property. These auctions offer a certain level of safety to the seller but are not usually as attractive to buyers as an Absolute Auction. A key strategy for a Minimum Bid Auction is for the seller to set the minimum bid low enough to attract the interest of buyers. Setting the minimum bid too high will discourage initial bidding.

Reserve Auction

Reserve Auctions allow the seller to accept, reject or counter the “winning” bid, for any reason. Sellers typically make this decision before the auction event ends. This gives sellers protection so their properties will not be sold below what they consider acceptable. However, sellers should be aware that Reserve Auctions typically generate the least amount of interest among potential buyers, because buyers know their "winning" bid can ultimately be rejected.

Sealed Bid Auction

In a Sealed Bid Auction, bidders privately submit their one best offer, in writing and in a sealed envelope. The bids are opened privately by the auctioneer and seller who do not reveal the bids to any of the participants. The seller can take one of the following courses of action: Accept the highest or best bid; reject all bids and call for a “Best and Final” bid from the two highest bidders, or just commence serious negotiations with all the identified bidders.  
  
Sealed Bid Auctions are often used for properties that do not have a broad market or appeal. Furthermore, keeping the bids private helps ensure that if all bids are too low for any of them to be accepted by the seller, the property will not become stigmatized by having a perceived low value in the marketplace.

Two-Step (or Combo) Auction

The Two-Step Auction is one in which sealed bids are sought from bidders (the first step) and if the seller does not accept the highest bid then the top five bidders are invited to participate in live bidding on an absolute or reserve basis (the second step) to determine the highest bidder. 
 
With distinct advantages to each of these common types of real estate auctions, sellers are encouraged to consult with the specialists at RealEstateAuctions.com for the best fit for each particular property.