Home, Land, Property Buying and Selling - Partition Action - Auction the property?
Doityourself.com community forum was created to provide answers to all questions related to home improvement and home repair. Doityourself community can help you find information about how-to topics on small fixes to large remodeling projects. With comprehensive how-to content and expertly moderated community forums DoItYourself.com makes it easy to tackle even the most complex home improvement projects.View Full Version : Partition Action - Auction the property?
spacerdave
10-22-07, 11:23 PM
I am currently in a partition action against my siblings. The property is currently for sale, and has been for sale for 3 months now. It has been difficult to get to this point since my siblings are not cooperating, even though there was a court order that said my siblings either need to buy me out or fully cooperate with a sale of the property. Due to the weak real estate market in California, it is not selling. The property also has a lot of deficiencies that is making it difficult to estimate the proper market value. Can I get the court to take over and auction the property? Or is it too soon for me to request this? Is there a point in time where the court would simply take over and auction the property?
slumlordfrank
10-23-07, 06:22 AM
Let's cover the different problems separately.
1. The house is not selling. The only reason that houses do not sell is price; not location, not deficiencies, not age, price. If you priced it at $100 you would have lots of offers before lunch time, so it's not the market it's the price.
The price you're asking is not the true market price. The true market price is somewhere between $100 and the asking price. Adjust the price downward, offer a bonus to the selling agent that brings in an offer, do something creative.
2. You can petition the court to conduct an auction, but that is going to cost big money. Lots more than you've spent in legal fees to this point. Figure $25K, plus the fee for the auctioneer.
IMO you would be better off buying the house, if it's within your means to do so. Other than that, get serious about the price.
frank
1. The house is not selling. The only reason that houses do not sell is price; not location, not deficiencies, not age, price. If you priced it at $100 you would have lots of offers before lunch time, so it's not the market it's the price.
The price you're asking is not the true market price. The true market price is somewhere between $100 and the asking price. Adjust the price downward, offer a bonus to the selling agent that brings in an offer, do something creative.
2. You can petition the court to conduct an auction, but that is going to cost big money. Lots more than you've spent in legal fees to this point. Figure $25K, plus the fee for the auctioneer.
IMO you would be better off buying the house, if it's within your means to do so. Other than that, get serious about the price.
frank
spacerdave
10-23-07, 09:52 AM
Thank you so much for your reply. That makes perfect sense to me. However, in my current situation, adjusting the asking price is easier said then done. My siblings have always been resistent to sell. It was hard enough to get them to sign the original listing agreement at $975,000. Now, the real estate broker is recommending a new price of $890,000. This is fine with me. But I know I will have to force my siblings to sign this new listing agreement. I am already paying attorney fees of $6000+ per month. At this point, I would like the court to step in and grant me full legal authority to control the marketing and sale of the property without their cooperation. Can I get the court to do this? Or should I look for a less expensive attorney?
DavePearson
10-25-07, 10:15 AM
I am not sure about the laws of CA, however, there is nothing that says the court has to auction the property. If you wanted to get rid of it, and all agreed, you could hire an auction firm to do it for you.
I know there are such things as court ordered auctions for exactly what you are discussing, but as stated, it will cost a bunch to get that far.
There are advantages and disadvantages to auctions. An advantage is, most are "as is where is" (at least in VA) with no contigencies. Buyers have an inspection period to look things over and make a reasonable decision as to what they are willing to pay. When it is all done, you will be rid of the property and do not have to worry about inspections and such. Odds are, you will get what it is worth, but you may not get what you want. You can also establish a reserve "minimum price" and it will not be sold unless the bid reaches the reserve. If the court orders it, there may not be much of a reserve (you may not have a choice in the amount).
Some disadvatages are, in a slower market, auctions may not get what you expect to get. There are people out looking for a good deal and if that is all who show up, they may get a good deal (not necessarily the right deal).
If you decide to go this route, check into local auction companies, ask around, get recommendations. I have dealt with some here and honestly, some are ethically questionable. They can get away with it because many of the winning bidders do not have the assistance of a licensed real estate agent with some knowledge of real estate regulations.
Do your research, check into the options. Depending on what you want to do, auction may or may not be right for you (and your siblings have to agree of course).
My recommendation would be to not let the court decide how you sell it, you decide. This means you will probably have to work things out with your siblings.
I know there are such things as court ordered auctions for exactly what you are discussing, but as stated, it will cost a bunch to get that far.
There are advantages and disadvantages to auctions. An advantage is, most are "as is where is" (at least in VA) with no contigencies. Buyers have an inspection period to look things over and make a reasonable decision as to what they are willing to pay. When it is all done, you will be rid of the property and do not have to worry about inspections and such. Odds are, you will get what it is worth, but you may not get what you want. You can also establish a reserve "minimum price" and it will not be sold unless the bid reaches the reserve. If the court orders it, there may not be much of a reserve (you may not have a choice in the amount).
Some disadvatages are, in a slower market, auctions may not get what you expect to get. There are people out looking for a good deal and if that is all who show up, they may get a good deal (not necessarily the right deal).
If you decide to go this route, check into local auction companies, ask around, get recommendations. I have dealt with some here and honestly, some are ethically questionable. They can get away with it because many of the winning bidders do not have the assistance of a licensed real estate agent with some knowledge of real estate regulations.
Do your research, check into the options. Depending on what you want to do, auction may or may not be right for you (and your siblings have to agree of course).
My recommendation would be to not let the court decide how you sell it, you decide. This means you will probably have to work things out with your siblings.