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Are Real Estate Auctions Right For You

Feb 13, 2008
I am getting sick and tired of all these unmaintained properties in my area. If only the banks would just adjust their prices then their messes could be cleaned up in a responsive fashion.

The lenders out there will have to learn to take the bite. Do not worry they are very creative and will get their money back from you another way.

Many prospective home buyers and investors have been trying to get great deals at auctions. I wonder why banks are sending a great deal of their properties to auction?

Live auctions have generally been a great way to sell that overstocked inventory. Everything from junk to real estate can be sold at auction.

Auctions can be held almost anywhere that a microphone can be setup. The mobility of theses auctioneers makes these live auctions very popular today. They are able to setup a whole auction in front of a house in less than twenty minutes.

Everyday I drive through my neighborhood I see more and more auction signs popping up. I assuming that the lenders are trying to get a higher price than on the open market. It is true than they can receive a higher price at auction. I have seen it with my own eyes people bidding up properties more than they are worth.

The majority of auction houses have a fixed percentage of the final selling price of the auctioned products or homes to be received as their payment. I have seen the typical amounts to be around three to five percent to be added to the winning bid.

When placing your first bid at a real estate auction always remember that there are additional cost on top of your bid. As rule of thumb I usually calculate about an extra ten percent in additional costs to be safe when calculating my highest bid price.

The problem with a significant number of auction houses today is their rules and guidelines. Usually rules and guidelines are to protect the buyer and the seller but I wish that was true. Be very careful and read all of the small print pertaining to the auction you are interested in attending. Make sure you read the sections pertaining to bidding and buying at auction.

I wish that when I went to an auction I could win a property for the opening bid. I wish that some body could, but even if I was the only one there I still couldn't. Those incredible low prices only exist to drive traffic to the auctions.

I always thought the when you go to an auction if you bid the highest you win. I wish that was actually true. Many of the auctions have all things these super low starting points. It seems that they always forget to mention that there is a reserve price in the front of there books. Basically those numbers mean nothing and are just a fantasy. The lenders still get the price they want or they don't have to sell.

Did you know that if you win an auction the seller typically has seven days to accept or deny your bid? Even if you win and your bid is higher than their reserve that does not mean that you have won.

I can see that the auctions are in the favor of the seller. One of things that I hate the most is wasting my time. They make you fill out forms then make you pre-qualify to bid. If I knew my final bid really meant I won that would be different.

I do think that the experience of an auction should be felt once. You never know you could get that deal.
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