Question 1

Do you charge a buyers premium or fee?

Jason Smith · Accepted Answer

It is never up to the auction company to charge a buyers premium, that is the sellers decision.  Would we take an auction if the seller chose to use buyers premium to pay commission?  Yes we do and have.  We always thoroughly explain to the seller the use of a buyers premium and sellers commissions.  Some sellers charge a buyers premium because they believe the auction process serves both the buyer and the seller, after all, they could have just sold the farm privately and not given buyers a chance to buy it.  Other sellers believe buyers would not bid because of a buyers premium and choose to use only an undisclosed sellers commission.  Either way, the buyers premium just becomes a part of the price of the real estate purchased and is added to the price.  We believe bidders are accused to factoring in incidental costs and bidding accordingly and we believe sellers have the right to offer their farm in any format or term they desire.  We of course insist on complete honesty and ensure any buyers fee is prominently advertised and known by bidders.

Question 2

My family is not getting along, and we can’t make a decision for the farm. What do we do?

webspec_admin · Accepted Answer

It is never easy to go through the process of selling the family farm or estate. Sibling rivalry, economic disparity between heirs, and many other factors can play a hand in making things difficult. Though it can seem silly, it has helped a lot of families to abide by the following ground rules:

Everybody must take turns talking. Alternating between birth order and reverse birth order is a fair way to allow comments.
Only discuss items on the agenda during each discussion. Nobody is allowed to refer to some previous wrong-doing or action.
No profanity or personal insults. Violating this rule will have predetermined consequences.
References to others’ finances are not allowed.
No assigning blame to anybody for anything.

Question 3

How much commission do you charge?

webspec_admin · Accepted Answer

As little as possible and we offer a fee de-escalation!  We work in a very competitive industry and we are market leaders because we have been able to competitively deliver top of the market services and outcomes for our clients.  Our worry free offer to our clients brings them peace at a time when they are often overwhelmed.  We won't add to your stress, we want to be a part of the solution.  We are able to offer every client a low stress selling experience for a very reasonable fee.  Our fee de-escalation policy ensures that every client sees the lowest possible commission structure that beats competing offers for the same services every time guaranteed! See our fees, click the button

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Question 4

Is it better to list land privately first, or to hold a land auction?

webspec_admin · Accepted Answer

Auctions are the overall best way to sell properties where demand is average or higher because all buyers then have reasonably equal leverage. The following situations may do better with a private listing:

When competition will be difficult to create between buying demographics
When a certain bidder has exceptional leverage
If the property has a problem that is not easily correctable
The property is low-quality with little demand

We’re here to help you determine the best course of action for your unique property.

Question 5

How do I decide whether or not to take the high bid during a land auction?

webspec_admin · Accepted Answer

Saying no to the highest bid during an auction should be considered carefully and with caution. As a seller, when you say no to the high bid during an auction, auction law dictates that all bids become void and bidding moves back to $0. Some believe this ‘buys time’ and they are allowed to go back and accept the bid. This is untrue. If a farm auction was properly marketed and conducted, then the highest market value was likely already achieved by the highest bid.

Question 6

As a seller, what do I do on auction day?

webspec_admin · Accepted Answer

You have multiple options as a seller on auction day:

Join our team in person and monitor the auction
Join our team via telephone or video conference
Watch the auction from an online bidder’s point of view and wait for a phone call from our team
Give DreamDirt instructions and not join in the auction

We’re here to make your life easy, and ensure you the best experience.

Question 7

How long does it take to auction farmland?

webspec_admin · Accepted Answer

The entire process, from the day you sign a listing agreement to sell, to the closing process after the auction, lasts around 65-80 days. There are two phases. Marketing lasts roughly 30 days at the end of which is the auction, and closing takes somewhere between 30 and 40 days.

Question 8

How do online land auctions get advertised?

webspec_admin · Accepted Answer

DreamDirt utilizes traditional advertising mediums such as newspapers, signs, sale bills, and direct mail along with modern digital advertising and cutting-edge drone footage to guarantee a high-level of exposure for your land auction. All advertising is done in-house, unlike other auction companies who have to work with 3rd-party vendors. Your auction advertising is personally curated, tracked, and tended to by our marketing professionals.

Question 9

What is the first step in selling my farm? Who should I talk to?

Accepted Answer

The first step to selling something as large-scale and valuable as your farm is to talk to a professional. Your DreamDirt representative can get you started by answering any crucial questions you may have and guide you in the right direction. We expect no commitment and promise to answer any of your questions without obligation.

Question 10

Do auctions sell for very low prices?

webspec_admin · Accepted Answer

No. Auctions always sell property for its true market value. Auctions are the premiere sale method for rare and valuable items. With today’s increasing population and decreasing amount of arable land, what is more valuable than a high-quality tract of Iowa farmland? Auctions consistently bring land its true market value over public listings and private sales. Feel free to browse our Sold Properties.

Question 11

Are auctions a last-resort sale?

Accepted Answer

Auctions get a bad rap for being the ‘desperate’ method of selling, although this is far from the truth. Statistics prove that farmland auction prices are better than private sale prices. Auctions are the best first choice to sell the farm, and in fact, listing the property first only to resort to an auction looks desperate and can ultimately sabotage the end results.

Question 12

How do I go about having an auction?

Accepted Answer

When creating an auction, you can boil down the process to five steps: setting a sellers objective, defining what a positive outcome looks like, identifying the core and secondary markets, advertising and marketing the property, and executing the sale. The best way to go about having an auction is to contact one of our professional and certified auctioneers to walk you through the process.

Question 13

Can I sell a farm with a tenant?

Accepted Answer

While many sellers that inherit farms falsely believe they cannot sell a tenant-occupied farm, the truth is that you can! The only change for the tenant is that they would get a new landlord - the buyer of the farm. In the case that sellers wish to sell the farm with no tenancy, most states have farm tenancy laws that dictate the amount of notice one must give the tenant before eliminating their tenancy. DreamDirt can help distribute the proper notice to tenants, and put you in the best position to sell the farm.

Question 14

When is the best time to sell farmland?

Accepted Answer

The answer can vary slightly depending on each scenario, but in general there is not a bad time of year to sell! Certain considerations such as type of land may sell better at certain times (hunting land sells better in-season) and the time of year may affect your terms and conditions of the sale, but your DreamDirt representative works with you to create demand and drive your sale forward regardless of the season.

Question 15

Can land auction sellers set a minimum or reserve price?

Accepted Answer

Yes. A reserve/minimum is a protection point and not an asking price. A reserve price should be set at lower than what you think the land is going to sell for, but high enough that you are protected from a financial disaster. After years and years of conducting auctions, studying the data, and experiencing the results, DreamDirt auctioneers have developed a science to setting a reserve price. When lifted at a crucial moment during the auction, this signals commitment to your buyers and drives even further bidder competition.

Question 16

Do you charge a buyers premium or fee?

Jason Smith · Accepted Answer

It is never up to the auction company to charge a buyers premium, that is the sellers decision.  Would we take an auction if the seller chose to use buyers premium to pay commission?  Yes we do and have.  We always thoroughly explain to the seller the use of a buyers premium and sellers commissions.  Some sellers charge a buyers premium because they believe the auction process serves both the buyer and the seller, after all, they could have just sold the farm privately and not given buyers a chance to buy it.  Other sellers believe buyers would not bid because of a buyers premium and choose to use only an undisclosed sellers commission.  Either way, the buyers premium just becomes a part of the price of the real estate purchased and is added to the price.  We believe bidders are accused to factoring in incidental costs and bidding accordingly and we believe sellers have the right to offer their farm in any format or term they desire.  We of course insist on complete honesty and ensure any buyers fee is prominently advertised and known by bidders.

Question 17

Should I Give My Tenant First Right to Buy My Farm?

Jason Smith · Accepted Answer

This is a personal decision you have to decide based on your own situation.  It is always disappointing to the local neighborhood when they did not get an opportunity to purchase any farm. The question is better started "Am I obligated to allow my tenant first right to buy the farm" and the answer is NO.  You are under no obligation at all and in almost 100% of cases you will achieve more money by selling at auction where the tenant can still bid to buy the farm.  Tenants can often put significant pressure on a family to let them have first shot and often at a discount that you may not even realize.  You will need to consider your objective and obligations.  Are you representing a family with different heirs?  Is everybody entitled to full market value of the farm?  Are the neighbors entitled to an opportunity to also purchase the farm?  Understand that when you have had a tenant you have had a business relationship.  You provide real estate they have used to make a profit and in exchange made a rent payment to you.  We understand that you likely formed a relationship and it can be used against you if you let it.  If you consider your own objections and obligations you will come up with the right answer for you.  We are glad to talk to you about these issues and the complexity of it or even assist you in moving forward.

Question 18

What Kind of Auctions Do You Provide?

Jason Smith · Accepted Answer

We are a full service auction and real estate company. We provide every type of auction imaginable. Auctions are typically broken down into 3 categories which include Live In-Person Auctions, Online Only Auctions, Hybrid Auctions.

Live In-Person Auctions are the traditional auction where the auctioneer talks fast and the bidders raise their hand to bid.
Online Only Autions or Timed Online Auctions are an auction that is exactly the same marketing and advertising as a Live In-Person Auction but the bidding event takes place on our website using specialized software we developed specifically for selling land.
Hybrid Auctions are auctions where a live crowd assembles, the auctioneer talks fast but Internet bidders can bid simultaneously with the in person bidders.

We also provide real estate brokerage or "priced listings" and can help negotiate the sale of real estate without the use of an auction.

Question 19

What is a professional auctioneer?

webspec_admin · Accepted Answer

In the auction industry, the word ‘professional’ carries no official definition. For some people auctioneering is a weekend hobby, for us its a professional full time career. Anybody can say they are a ‘professional’ auctioneer. When choosing an auctioneer to carry out your land auction, do your research and check the credibility of any prospectives. When DreamDirt calls our auctioneers ‘professionals’ we have years of experience backing up that claim. All of our auctioneers have graduated from the World Wide College of Auctioneering and hold the CAI designation which only one percent of ‘professional’ auctioneers have.. We require all our auctioneers to also hold their real estate license, and surround our auctioneers with an in-house team of experts who can build, advertise, conduct, insure, and close an auction without having to rely on outside parties. We ensure our methods are sound through many different collaborative efforts and encourage our staff to participate in professional organizations, training and networking events. Our auctioneers have been called on to teach at Auctioneer training institutions or speak to real estate agent training classes. We are confident our auctioneers are among the most knowledgable and best able to serve your needs professionally.

Question 20

How does weather affect a land auction?

webspec_admin · Accepted Answer

An online auction is not affected by weather conditions. Obviously for an outdoor auction it can affect the comfort of bidders but its a well known phenomenon that bad weather never stops bidders and probably encourages them with the false belief they can "get a good deal" and luckily its psychology that affects everybody. That hope brings everybody to the auction. Truthfully, when something in selling and there is only one opportunity to buy it ever, weather can't stop bidders from showing up. Some of our most memorable auctions were sold in rain storms or blizzards and they did very well. Today's technology really eliminates those concerns, we can keep bidders comfortable in any situation and in the Midwest, we are pretty accustomed to bad weather. We do many things in bad weather from feeding cows to getting crops in or out.

Question 21

What if a potential online auction bidder does not use the internet?

webspec_admin · Accepted Answer

If internet options aren’t possible, DreamDirt will help these potential bidders connect to the auction via telephone or an alternate live bidding location.

Question 22

What if the online auction technology fails?

webspec_admin · Accepted Answer

While we have never experienced a catastrophic technology failure during an auction, we have created a system to handle the potential for these events. We’ve created redundancy and mirror sites that seamlessly take over if one technology fails.

Question 23

How do you know online auction bidders are real?

webspec_admin · Accepted Answer

At a typical land auction, bidders are not required to identify themselves. In our online auctions, registration of bidders is private and required. DreamDirt utilizes a four-step registration process with identity verification. One step is providing a credit card that matches the bidder profile information. Another step involves a phone interview where bidders answer questions to cross-check their information and financial capabilities.

Question 24

What if nobody bids at an auction?

webspec_admin · Accepted Answer

This never occurs due to the fact that land is an extremely valuable resource in today’s world. Every farm has a use and value, we've never had a farm not receive bids. If this was to happen, the auction can close and the sale can move forward privately as a listing.

Question 25

What is the difference between a reserve auction and an absolute auction?

webspec_admin · Accepted Answer

In a reserve auction, the seller sets an undisclosed price the farm must reach before it can sell. In absolute auctions, the seller guarantees that the land will sell to the highest bidder regardless of the price.

Question 26

What is the difference between an online land auction and a live land auction?

webspec_admin · Accepted Answer

All types of auctions work well. Advertising for all auctions is identical. The primary differences between the two types of auctions (apart from one being online) are that online auctions can:

Directly connect bidders to the actual land auction to bid through advertising hyperlinks and allow them to take action when they desire.
Reduce social pressures and bidder friction, ultimately freeing bidders to reach higher prices and their maximum ability
Eliminates bidders unpleasant personal feelings by allowing them to bid in private.
Lower the cost to sellers while increasing a sale’s efficiency and increasing the sellers net result
Create speed and urgency due to buying against a clock
Take advantage of modern technology to increase the bidder pool
Directly creates convenience that bidders enjoy

Question 27

Do auctions bring less money than real estate listings?

webspec_admin · Accepted Answer

In 2017, approximately 55% of farmland in Iowa was sold via auction and only 17% was sold by listing. The reason for this is that land auctions create an ideal outcome in terms and conditions and price. Auctions bring more money by nature due to the fact that your bidders compete with HIGHER prices, whereas in real estate sales sellers are forced to continually return to negotiating a lower price. In addition, auctions create competitive bidding, are rid of contingencies, feature as-is selling conditions, simple negotiations, among other things.

Question 28

Do you charge a buyers premium or fee?

Jason Smith · Accepted Answer

It is never up to the auction company to charge a buyers premium, that is the sellers decision.  Would we take an auction if the seller chose to use buyers premium to pay commission?  Yes we do and have.  We always thoroughly explain to the seller the use of a buyers premium and sellers commissions.  Some sellers charge a buyers premium because they believe the auction process serves both the buyer and the seller, after all, they could have just sold the farm privately and not given buyers a chance to buy it.  Other sellers believe buyers would not bid because of a buyers premium and choose to use only an undisclosed sellers commission.  Either way, the buyers premium just becomes a part of the price of the real estate purchased and is added to the price.  We believe bidders are accused to factoring in incidental costs and bidding accordingly and we believe sellers have the right to offer their farm in any format or term they desire.  We of course insist on complete honesty and ensure any buyers fee is prominently advertised and known by bidders.

Question 29

How does bidder communication differ in an online land auction?

webspec_admin · Accepted Answer

Online bidders have multiple ways of communicating with an auction manager. This includes chat functions, text messaging capabilities, browser notifications, and a telephone dialer. An auctioneer can broadcast messages to all bidders or directly to a specific bidder at any point in the auction.

Question 30

Why do auction terms and conditions sell using cash bids?

webspec_admin · Accepted Answer

Cash bids require that buyers bid as if they are spending cash, but in most cases, the buyer will require financing. If a buyer requires financing they must follow through on their bid amount no matter what. This ensures that the seller receives the highest bid regardless of the buyer’s circumstance.

Question 31

Can someone in my family estate or trust buy the farmland through auction?

webspec_admin · Accepted Answer

A family can agree upon any conditions for the auction of the land. However, most family members are treated as a typical bidder and can purchase the farmland through auction.

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