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Book of Abstracts: 2005 European Real Estate Society conference in association with the International Real Estate Society
Sealed Bid Auctions and Buyer Behavior: Evidence from Scottish Housing Markets
Carolyn A. Dehring, Neil Dunse, Henry J. Munneke, M. Rosa Trovato, Anika Valenti

Paper Summary

Sellers in Scotland have two options when pricing their homes: offers over or fixed price. Offers over typically leads to higher selling prices because buyers tend to overbid to avoid future search costs. Buyers are non-cooperative, leading to inefficiencies. By analyzing 15,500 home sales data, researchers found that the offers over system results in higher expected selling prices compared to fixed price. This suggests that informed sellers should choose the offers over system to maximize their profits.

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