Selling a condo at a real estate auction

Selling a condo at a real estate auction can be very nerve racking if you've never done it before.  Most people think that an auction means that regardless of what people bid for it, in the end, the price that is the highest is what you're going to have to sell it for.  It really does not work that way.

There are three ways to sell a condo at a real estate auction.  Many choose the process of selling the condo by "reserve auction".  This means that when the process of bidding ends and a winner is determined, the buyer signs a contract and then the seller normally has three business days to make a decision if they want to accept the contract.  This is 100% full protection for the seller of the condo.  There is a slight problem with this. What if the seller does not want to accept the real estate contract? What happens to the buyer? Think about all the effort it took for the buyer to eventually be accepted as a high bidder in this reserve auction. 

Let's think through the entire buyer process. The reserve auction buyer visits the open house after viewing the information on the real estate website.  They get attached enough to a property that they decide to go to the bank and get a cashier's check to bid the day of the auction.  During the open house they bring their construction guy to check the place out and get an expert opinion.  They then check on financing the condo because they know that the contract will be an as-is contract not subject to them getting financed.  They better be prepared that if the bid gets accepted that they can get the additional 95% financed.  They will have to put 5% down the day of the event.  They do not want to lose this money.  So, they go to a bank and get prequalified giving them the assurance that they can bid on the property and win it.

Now it's the day of the event.  The crowd is huge and their excited about bidding on a condo in the real estate auction. The property comes up for bidding and they start the process off.  As time goes on two or three people are in the hunt to buy the property as well.  After a minute or two the bidding slows down and the buyer wins the condo.  But does he really?  The seller still has to decide if they'll accept the bid or not. 

The reserve auction is great for a seller but not so great for a buyer.  The seller of a condo at a reserve auction must take this into consideration when listing their property in the auction.  Will the reserve auction get the attention from buyers because its reserve?