Auctioneers Head into Fall After a Strong Summer
YOUNGSTOWN, Ohio – The region’s auctioneers are encouraged by a strong volume of business during the spring and summer months, anticipating a busy autumn filled with competitive bidding and higher sales.
Single-family houses, personal property, vehicles, collectibles, machinery, farmland, and commercial sites continue to attract interest among buyers and sellers in northeastern Ohio who prefer conducting business at auctions rather than other avenues.
“Spring and summer were very good,” says Russell “Rusty” Kiko Jr., co-owner of Kiko Auctioneers and Realtors based in Canton. “Land sales seem to be holding up fairly well.”
Demand for tillable farmland in northeastern Ohio remains strong, Kiko says, although it’s down slightly from several years ago when commodity prices were high. On average, good farmland is selling at auction for $5,000 to $7,500 per acre – solid prices depending on drainage and the condition of the property.
“Most of the farm sales we’re doing are sales by choice,” Kiko notes. “In many cases, it’s a family farm and they’re retiring. There have been a few distress sales, but not many.”
A rash of bonuses paid landowners through oil and gas leases in the Utica shale possibly helped some farm owners to sell earlier than they planned, but these sellers have also held on to their mineral rights. “We’ve seen some of that over the last couple of years,” Kiko adds. “Some have cashed in on the opportunity and sold their land but kept mineral rights.”
Today, interest in selling mineral rights separately from the land isn’t as attractive as it was three years ago, Kiko says, because oil and gas prices have plummeted. “We’ve sold some off separately,” he adds. Last month the auctioneer sold the mineral rights on two parcels in Carroll and Columbiana counties at $3,100 an acre and $3,000 an acre respectively.
“Real estate has been strong – especially farmland, hunting land and good used equipment,” he says.
Plus, the demand for land has dipped slightly since commodity prices have dropped from a high point several years ago, Kiko says. “Interest rates were low and grain prices were high then, so there was a buying frenzy. Land rents went through the roof.”
For many auctioneers, the avenues have changed when it comes to selling and auctioning personal items.
“There’s a big shift toward Internet-only auctions,” says Paul Basinger, president of Basinger Auction Service, Ltd., North Lima. “People can attend our previews, but Internet auctions today saves the buyer time and the seller money.”
Content previews are held at the auction company’s address in North Lima, Basinger says, where potential bidders can examine items listed on the auctioneer’s website. However, all personal property auctions are conducted online and bids are accepted only online.
“We’ve found that less than 30% of those who bid actually show up for the preview,” Basinger says. “We take high-resolution pictures, and most savvy buyers are willing to take our description.”
Moreover, online auctions reach a worldwide market instead of being limited to a regional audience. “There are many more prospective bidders,” Basinger says. “We’ve shipped sterling silverware to Singapore and bikes to Japan.” The buyer assumes all cost of shipping.
The Internet opens the sale to more competitive bids, Basinger says, and those interested can place their offers from the comfort of their own homes. The more bids, the more likely an item will sell, and sell at an agreeable price.
“We recently sold a gas pump that started at $100,” he relates. “It eventually sold for $3,500.”
While the Internet is a source of convenience for buyer and seller, many older bidders see it as an aberration of the social aspect that comes from attending a live auction, Basinger says. “They’re usually the dollar buyers,” he explains, and not interested the high-ticket items. “They come for the fun and camaraderie, so that social aspect is gone.”
Still, Internet auctions save Basinger on overhead and the headaches of parking, setting up tents and concerns about where to set up restrooms for customers. And, the Internet has allowed Basinger to conduct more than one auction simultaneously, where before a single on-site sale commanded most of his staff’s attention and an entire day of work. “We could have three or four auctions closing in a night,” he says.
Jeff Byce, president of ByceRealty has also converted all of his personal property and vehicle auctions online. However, most real estate auctions remain conducted on site, he says. “We’re starting to sell some real estate online as well,” Byce says.
Among the latest marketing tool is the use of drone photography, where potential buyers have a bird’s eye view of the land or house in which they’re interested. “We’ve got two large land auctions in the pipeline,” Byce says.
Successful as the auction business has been for the company, Byce says his business is moving away from the traditional auction brand. Instead, he’s positioning the business as more of a full-service realty firm rather an auction house. “This is the first year we’ve sold more real estate through conventional means than at auction,” he reports.
A growing segment of the business, Byce says, is through courts appointing his company as “special master” to conduct foreclosure sales on behalf of lenders. “The foreclosure process can easily take a year before it goes to a sheriff’s sale,” Byce adds. “We can get it down to 60 days.”
Should Byce be appointed a special master, the company then markets the assets to a target audience before the sale and conducts what is akin to a private, on-site auction of the property. “We’ve sold well over a half-million dollars of property through this method,” he remarks.
Not all properties qualify for sale by a special master, Byce says. First, the lender must demonstrate a special reason for the court to appoint a commissioner to expedite the sale. One reason could be the inordinate amount of time between the foreclosure decree and the actual foreclosure sale. Another might be that an expedited sale would benefit the lender because of the nature or condition of the property.
The property value must command at least $30,000.
“It’s a legal proceeding rather than a true auction,” Byce adds. “It accelerates the sale, retains higher property values and reduces the risk of damage to the property.”
Pictured: Chris Roman, an auctioneer with George Roman Auctioneers, says bid prices and attendance are on the rise.
Copyright 2023 The Business Journal, Youngstown, Ohio.