The Newly Discovered Benefits to Online Model Home Furniture Auctions

Eddie Harper on behalf of Builders Auction Co.

Builders large and small know the advantages of building and designing model houses in their communities. Even in the age of pioneering technology, a fully furnished model serves as a first personal impression and enables buyers to physically imagine how they live in the room.

When the community is sold out or the model is no longer needed, it will be put up for sale. Builders who are motivated to increase profits and reduce costs then have several options for dealing with the staged pieces within the home. Key options include selling the furniture to the model buyer when buying a home, relocating the items to another model, keeping them for a future model, or liquidating the assets by selling them to employees, using an auction company, or giving them to the local one Resale or delivery companies.

“We do a few different things,” says Chrissie Hartle, regional sales specialist at Ryan Homes, an NVR brand. “We sometimes reuse our furniture in our models, and sometimes we just say we’ve used this furniture long enough and let us get rid of it.”

Eddie Harper on behalf of Builders Auction Co.

Live and in person
If the liquidation route is chosen, Houston-based Builders Auction Co. has been assisting builders across the country with auction services since 1996. Leading national construction companies featured on the Builder 100 annually including David Weekley, Lennar, Meritage Homes, Mattamy Homes and Taylor Morrison, M / I Homes, NVR, and others have all used the company’s services to create the content of a To liquidate the model.

For the traditional face-to-face auction, which the company has been running for over 20 years, the contractor worked with the auction team to set a date and send sales notices to potential local bidders. Then, on the day of, the team came to the model, sorted and cataloged the furniture, covered the floors to reduce the risk of damage, registered bidders and sold the content within hours.

“Right from the start there were a lot of people filling the house, but that eventually became a problem of mine and it was a pain point for the builders,” says Bruce Sutter, President and CEO of Builders Auction Co.. because you were afraid of too many people in the house, especially the harm or perceived harm to the new homeowner. “

When the coronavirus pandemic hit earlier this year, Sutter and the Builders Auction team were unable to conduct in-person auctions on models and decided to quickly move the process online to continue serving builders in a time of uncertainty.

Prior to COVID, Sutter had considered moving the company’s operations online, but he “felt that a lot of people were going to lose their jobs or that some of the company’s employees didn’t want to go in that direction,” he says. “When the COVID crisis happened, there was no choice.”

Eddie Harper on behalf of Builders Auction Co.

Virtual advantages
To get its services online, Builders Auction Co. discovered an online bidding platform and decided to post photos, dimensions and descriptions of the various models’ contents on its website during set auction times.

Users can view upcoming auctions, register for email notifications, and bid for items directly on the website. When an auction starts, locals have 40 hours to bid and bid on items of their choice. From there, the winners choose a time slot to collect their furniture from the roadside, or they choose to use a mover and have it delivered. Except for a few employees and the professional moving company, nobody is allowed to provide adequate social distancing at home.

“People don’t necessarily want to spend time at a live auction, although it’s fun,” says Sutter, noting that going online makes a lot more sense from a business perspective.

Although the transition from in person to online was unexpected and quick, the participating builders were surprised by the results. Some of the benefits include:

  • Potentially higher earnings. Builders who use online auctions earn 10% to 20% more – and sometimes up to 50% more – per item than with a live auction.
  • More bidders. The number of bidders has also increased with a live auction, as the bidders do not have to leave home.
  • More time for bids. With a bidding period of 40 hours, bidders have enough time to research the items and place their bids.
  • The ability to sell more items. Since the model is full of people during a live auction, the number of items that can be sold is limited for security reasons. In an online auction, builders can bring in items from other models and fill the entire space with goods.
  • Less people in the apartment. Restricting access to the model to employees and professional moving companies reduces the likelihood of damage or wear and tear to both merchandise and property.
  • Better traffic management. Builders Auction Co. assigns a pick-up time to winners and limits roadside pick-ups to 10 people per hour.

“You would never know that something had changed in terms of the process,” explains Hartle. “It’s still the same process, except that you’re not bidding in person, but on a computer. Everything else was seamless. “

Alicia Schwarze, operations manager at Trophy Signature Homes in Dallas, a subsidiary of Green Brick Partners, agrees. Their first online auction with Trophy generated more sales than the traditional in-person auction due to more interested online bidders.

“I like it better,” says Schwarze. “Even if COVID goes away, which I hope I would still want to do virtual auctions.”

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