Coffeez for Closers with Joe Shalaby: Episode Summary

Episode Title: Real Estate Auctions in America ft. Simon Polito
Guest: Simon Polito, Founder of Reca Auctions
Release Date: May 2, 2025

1. Introduction to the Episode

In this compelling episode of "Coffeez for Closers," host Joseph Shalaby engages in an insightful conversation with Simon Polito, an innovative real estate entrepreneur revolutionizing the American real estate market through auction-based sales. The episode delves deep into Simon's unique approach, the challenges of introducing auctions to a traditionally conservative market, and the personal philosophies that drive his success.

2. Guest Background: Simon Polito

Simon Polito brings a rich international perspective to the table. Born in Sydney, Australia, to an Italian grandfather and a Lebanese mother, Simon was immersed in a multicultural environment from a young age. His early experiences in the Sydney fruit markets, working alongside his grandfather, instilled in him a strong work ethic and community-oriented mindset.

"I've always worked. But it's always about being part of the community. That was the biggest thing I took from it. Like, always be there for the people."
(00:05)

3. Introducing the Auction Model in the U.S.

Upon relocating to the United States nine years ago, Simon recognized a significant gap in the American real estate market: the underutilization and stigmatization of auctions. In Sydney, approximately 90% of real estate transactions are conducted via auction—an approach known for its speed, transparency, and competitiveness.

"I thought, you know, I'm gonna try and change the game a little bit, shake it up with some new technology and to see who gravitates towards it."
(02:16)

Simon founded Reca Auctions with the mission to transform the U.S. real estate landscape by introducing auction-based sales for traditional, luxury, and unique properties, moving away from the negative connotations associated with auctions in America.

4. Overcoming the Stigma of Auctions

In the U.S., auctions are often linked with distressed properties and foreclosures, contrasting sharply with their prestigious counterparts worldwide, such as Sotheby's or Christie's auctions.

"I started my own company. I thought, you know, I'm gonna try and change the game a little bit... so far it's been a rough ride. But we're now starting to get some weight."
(02:19)

Simon emphasizes the importance of education in shifting perceptions. By focusing exclusively on non-distressed properties and providing comprehensive pre-auction preparations, Reca Auctions aims to eliminate the negative stigma and showcase the benefits of the auction model.

5. Auction vs. Traditional Real Estate Methods

Simon employs a hybrid approach, leveraging both auction and traditional sales methods based on the seller's comfort and the property's nature.

"I do both. Because sometimes auction isn't the right scenario for that seller... but just know that I've got that backup plan ready to kick in when you're ready."
(03:05)

This flexibility ensures that Reca Auctions can cater to a broader client base while maintaining the integrity and advantages of the auction model.

6. Strategies for Successful Auctions

A cornerstone of Simon's strategy is to list properties at approximately 20% below market value to attract intense bidding competition, often resulting in sales above market value.

"On average, we start around 20% below... and on average, from our sales, we've been achieving between 25 and 30% above."
(08:37)

Simon draws parallels to eBay's bidding system, explaining how starting bids create urgency and competition, ultimately driving prices upward.

7. The Psychology Behind Auctions

Understanding buyer psychology is crucial to Simon's success. He leverages the competitive nature of buyers, often driven by ego and the fear of missing out, to maximize sale prices.

"It’s about the psychology of people. You want this, I want you to write something down... people pay more because they need it right now."
(09:18)

Simon employs tactical communication to encourage higher bids, such as highlighting the uniqueness and scarcity of properties to intensify the bidding frenzy.

8. Managing Emotions on the Auction Floor

Auctions are high-stress environments where emotions run rampant. Simon excels in maintaining control through his dynamic auctioneering style, blending humor and strategic communication to keep bidders engaged and motivated.

"I'm a bit of a comedian... I keep the crowd entertained and manage them by not just myself. I've got my team."
(21:30)

His ability to connect with diverse personalities ensures a lively and productive auction atmosphere, fostering a sense of excitement and competition.

9. Business Insights and Challenges

Simon candidly discusses the challenges Reca Auctions has faced, particularly during the COVID-19 pandemic, which saw a drastic drop in transactions. However, persistence and strategic marketing have led to a resurgence, with the company now closing around 30 transactions monthly.

"Before COVID we were doing 100 a year... last week, however, we've listed seven properties in the last week."
(14:55)

He criticizes the current state of many real estate agents for relying on outdated marketing tactics, advocating instead for innovative and comprehensive strategies to achieve quick and profitable sales.

10. Personal Insights: Family and Grit

Balancing a demanding career with family life is a recurring theme. Simon shares his dedication to instilling resilience and a strong work ethic in his children, drawing from his own upbringing and the entrepreneurial spirit of his immigrant parents.

"I want to raise my kids to appreciate the dollar, respect the dollar, and respect who they are as a person, that they earned that money."
(33:36)

He emphasizes the importance of earning rewards and fostering gratitude, striving to ensure his children understand the value of hard work and financial responsibility.

11. Faith and Resilience

Faith plays a significant role in Simon's life. He discusses his belief in God's guidance and the importance of maintaining inner peace and confidence amidst the challenges of business and personal life.

"His power is unstoppable. And the sky's the limit as long as you are open to following the path that he provides you with."
(39:43)

Joining men's groups and engaging in Bible studies have been pivotal in maintaining his spiritual well-being and resilience, enabling him to navigate the highs and lows of entrepreneurship.

12. Future Goals and Closing Remarks

Simon outlines his ambitions for Reca Auctions, aiming to expand nationwide by securing the necessary funding and scaling his proven auction model across the United States.

"My business goal is to take Reca nationwide... I've got all the tools ready to go nationwide."
(41:56)

On a personal note, he aspires to provide a stable and loving home for his children, ensuring they receive the best life through education and moral guidance rather than material excess.

"I want to be able to give them the best life I can. And that doesn't have to necessarily mean I buy them everything they want."
(42:58)

Simon concludes the conversation by sharing his vision of remaining steadfast in faith and purpose, encouraging others to bet on themselves and maintain their resilience in the face of adversity.

Notable Quotes with Timestamps

• On Community and Hard Work:

  "I've always worked. But it's always about being part of the community. That was the biggest thing I took from it."
  (00:05)

• On Changing the Real Estate Game:

  "I'm gonna try and change the game a little bit, shake it up with some new technology."
  (02:16)

• On Starting Auctions Below Market Value:

  "On average, we start around 20% below... and on average, from our sales, we've been achieving between 25 and 30% above."
  (08:37)

• On Bidding Psychology:

  "It’s about the psychology of people... people pay more because they need it right now."
  (09:18)

• On Raising Resilient Children:

  "I want to raise my kids to appreciate the dollar, respect the dollar, and respect who they are as a person."
  (33:36)

• On Faith and Purpose:

  "His power is unstoppable. And the sky's the limit as long as you are open to following the path that he provides you with."
  (39:43)

Conclusion

This episode of "Coffeez for Closers" offers a deep dive into the innovative strategies of Simon Polito, highlighting how his international experience and resilient mindset are reshaping the American real estate market. From overcoming stigmas and leveraging psychology to balancing personal and professional life, Simon's insights provide valuable lessons for entrepreneurs and real estate professionals alike. His commitment to community, faith, and continuous improvement serves as an inspiring blueprint for those looking to make meaningful changes in their industries.